Shubham Maheshwari's Recent Buy: Acquires $98K In Varex Imaging Stock

A notable insider purchase on August 12, was reported by Shubham Maheshwari, Chief Financial Officer at Varex Imaging VREX, based on the most recent SEC filing.

What Happened: In a significant move reported in a Form 4 filing with the U.S. Securities and Exchange Commission on Monday, Maheshwari purchased 9,007 shares of Varex Imaging, demonstrating confidence in the company's growth potential. The total value of the transaction stands at $98,896.

At Tuesday morning, Varex Imaging shares are up by 3.43%, trading at $11.15.

Delving into Varex Imaging's Background

Varex Imaging Corp designs and manufactures X-ray imaging components. It operates in two segments Medical and Industrial. The Medical segment, which is the key revenue driver, designs, manufactures, sells, and services X-ray imaging components comprising X-ray tubes, digital flat panel image detectors, high voltage connectors, ionization chambers, and buckys among others. The Industrial segment designs, manufactures, sells, and services Linatron X-ray accelerators, X-ray tubes, digital flat panel detectors and high voltage connectors among others. It has manufacturing, research, and development operation in the United States, Europe, Philippines and China, and sales and service operations throughout the world.

Unraveling the Financial Story of Varex Imaging

Negative Revenue Trend: Examining Varex Imaging's financials over 3 months reveals challenges. As of 30 June, 2024, the company experienced a decline of approximately -9.95% in revenue growth, reflecting a decrease in top-line earnings. As compared to competitors, the company encountered difficulties, with a growth rate lower than the average among peers in the Health Care sector.

Interpreting Earnings Metrics:

• Gross Margin: The company shows a low gross margin of 31.99%, suggesting potential challenges in cost control and profitability compared to its peers.

• Earnings per Share (EPS): Varex Imaging's EPS is below the industry average. The company faced challenges with a current EPS of 0.03. This suggests a potential decline in earnings.

Debt Management: Varex Imaging's debt-to-equity ratio is below the industry average at 0.81, reflecting a lower dependency on debt financing and a more conservative financial approach.

Financial Valuation Breakdown:

• Price to Earnings (P/E) Ratio: Varex Imaging's P/E ratio of 14.57 is below the industry average, suggesting the stock may be undervalued.

• Price to Sales (P/S) Ratio: The Price to Sales ratio is 0.66, which is lower than the industry average. This suggests a possible undervaluation based on sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): At 11.39, Varex Imaging's EV/EBITDA ratio reflects a below-par valuation compared to industry averages signalling undervaluation

Market Capitalization: Surpassing industry standards, the company's market capitalization asserts its dominance in terms of size, suggesting a robust market position.

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Understanding the Significance of Insider Transactions

Insider transactions contribute to decision-making but should be supplemented by a comprehensive investment analysis.

When discussing legal matters, the term "insider" refers to any officer, director, or beneficial owner holding more than ten percent of a company's equity securities, as stipulated in Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and significant hedge funds. Such insiders are required to report their transactions through a Form 4 filing, which must be completed within two business days of the transaction.

A new purchase by a company insider is a indication that they anticipate the stock will rise.

On the other hand, insider sells may not necessarily indicate a bearish view and can be motivated by various factors.

Cracking Transaction Codes

Surveying the realm of stock transactions, investors often give prominence to those unfolding in the open market, systematically detailed in Table I of the Form 4 filing. A P in Box 3 indicates a purchase, while S signifies a sale. Transaction code C denotes 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 Varex Imaging's Insider Trades.

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