Insider Decision: Nicholas M. Westfall Offloads $1.12M Worth Of Chemed Stock

Nicholas M. Westfall, Executive Vice President at Chemed CHE, reported an insider sell on July 31, according to a new SEC filing.

What Happened: Westfall's recent move involves selling 2,000 shares of Chemed. This information is documented in a Form 4 filing with the U.S. Securities and Exchange Commission on Wednesday. The total value is $1,123,160.

Tracking the Thursday's morning session, Chemed shares are trading at $579.99, showing a up of 1.72%.

Delving into Chemed's Background

Chemed Corp operates subsidiaries in two main segments: VITAS and Roto-Rooter. The VITAS segment generates the majority of the firm's revenue. It provides hospice and palliative care services to patients with terminal illnesses through a network of physicians, registered nurses, home health aides, social workers, and volunteers. The vast majority of the segment's revenue is received from the Medicare and Medicaid reimbursement programs. The Roto-Rooter segment provides plumbing, drain cleaning, water restoration, and related services to residential and commercial customers. Chemed generates the majority of its revenue from business in the United States.

Key Indicators: Chemed's Financial Health

Revenue Growth: Chemed displayed positive results in 3 months. As of 30 June, 2024, the company achieved a solid revenue growth rate of approximately 7.6%. This indicates a notable increase in the company's top-line earnings. As compared to its peers, the company achieved a growth rate higher than the average among peers in Health Care sector.

Insights into Profitability:

• Gross Margin: The company excels with a remarkable gross margin of 34.59%, indicating superior cost efficiency and profitability compared to its industry peers.

• Earnings per Share (EPS): Chemed's EPS outshines the industry average, indicating a strong bottom-line trend with a current EPS of 4.7.

Debt Management: Chemed's debt-to-equity ratio is below the industry average at 0.12, reflecting a lower dependency on debt financing and a more conservative financial approach.

Analyzing Market Valuation:

• Price to Earnings (P/E) Ratio: With a lower-than-average P/E ratio of 28.9, the stock indicates an attractive valuation, potentially presenting a buying opportunity.

• Price to Sales (P/S) Ratio: With a relatively high Price to Sales ratio of 3.73 as compared to the industry average, the stock might be considered overvalued based on sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): The company's EV/EBITDA ratio 18.78 is below the industry average, indicating that it may be relatively undervalued compared to peers.

Market Capitalization Perspectives: The company's market capitalization falls below industry averages, signaling a relatively smaller size compared to peers. This positioning may be influenced by factors such as perceived growth potential or operational scale.

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The Impact of Insider Transactions on Investments

Emphasizing the importance of a comprehensive approach, considering insider transactions is valuable, but it's crucial to evaluate them in conjunction with other investment factors.

From a legal standpoint, the term "insider" pertains to any officer, director, or beneficial owner holding more than ten percent of a company's equity securities as outlined in Section 12 of the Securities Exchange Act of 1934. This encompasses executives in the c-suite and significant hedge funds. These insiders are mandated to inform the public of their transactions through a Form 4 filing, to be submitted within two business days of the transaction.

A company insider's new purchase is a indicator of their positive anticipation for a rise in the stock.

While insider sells may not necessarily reflect a bearish view and can be motivated by various factors.

Important Transaction Codes

When dissecting transactions, the focal point for investors is often those occurring in the open market, meticulously detailed in Table I of the Form 4 filing. A P in Box 3 denotes a purchase, while S signifies a sale. Transaction code C indicates the conversion of an option, and transaction code A denotes a grant, award, or other acquisition of securities from the company.

Check Out The Full List Of Chemed's Insider Trades.

This article was generated by Benzinga's automated content engine and reviewed by an editor.