Insider Activity Update: Todd A Adams Executes Options Exercise, Resulting In $16.84M At Zurn Elkay Water

In a new SEC filing on November 8, it was revealed that Adams, Chairman and CEO at Zurn Elkay Water ZWS, executed a significant exercise of company stock options.

What Happened: A Form 4 filing from the U.S. Securities and Exchange Commission on Friday showed that Adams, Chairman and CEO at Zurn Elkay Water, a company in the Industrials sector, just exercised stock options worth 624,278 shares of ZWS stock with an exercise price of $12.21.

Zurn Elkay Water shares are trading down 0.0% at $39.19 at the time of this writing on Friday morning. Since the current price is $39.19, this makes Adams's 624,278 shares worth $16,840,924.

Unveiling the Story Behind Zurn Elkay Water

Zurn Elkay Water Solutions Corp designs procure, manufactures, and markets a range of clean water solutions for drinking water, hygiene, and sustainable water management. The Zurn Elkay product portfolio includes professional-grade water control and safety, water distribution and drainage, drinking water, finish plumbing, hygienic, environmental and site works products for public and private spaces.

Zurn Elkay Water: Financial Performance Dissected

Revenue Growth: Zurn Elkay Water displayed positive results in 3 months. As of 30 September, 2024, the company achieved a solid revenue growth rate of approximately 2.91%. This indicates a notable increase in the company's top-line earnings. As compared to competitors, the company surpassed expectations with a growth rate higher than the average among peers in the Industrials sector.

Profitability Metrics: Unlocking Value

• Gross Margin: The company maintains a high gross margin of 46.2%, indicating strong cost management and profitability compared to its peers.

• Earnings per Share (EPS): Zurn Elkay Water's EPS reflects a decline, falling below the industry average with a current EPS of 0.25.

Debt Management: Zurn Elkay Water's debt-to-equity ratio is below the industry average at 0.35, reflecting a lower dependency on debt financing and a more conservative financial approach.

In-Depth Valuation Examination:

• Price to Earnings (P/E) Ratio: A higher-than-average P/E ratio of 50.24 suggests caution, as the stock may be overvalued in the eyes of investors.

• Price to Sales (P/S) Ratio: With a higher-than-average P/S ratio of 4.43, Zurn Elkay Water's stock is perceived as being overvalued in the market, particularly in relation to sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): Boasting an EV/EBITDA ratio of 22.81, Zurn Elkay Water demonstrates a robust market valuation, outperforming industry benchmarks.

Market Capitalization: With restricted market capitalization, the company is positioned below industry averages. This reflects a smaller scale relative to peers.

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Navigating the Impact of Insider Transactions on Investments

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

Considering the legal perspective, an "insider" is defined as any officer, director, or beneficial owner holding more than ten percent of a company's equity securities, according to Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and major hedge funds. These insiders are mandated to disclose their transactions through a Form 4 filing, to be submitted within two business days of the transaction.

Pointing towards optimism, a company insider's new purchase signals their positive anticipation for the stock to rise.

Nevertheless, insider sells may not necessarily indicate a bearish view and can be influenced by various factors.

A Closer Look at Important Transaction Codes

Investors prefer focusing on transactions that take place in the open market, indicated in Table I of the Form 4 filing. A P in Box 3 indicates a purchase, while S indicates a sale. Transaction code C indicates the conversion of an option, and transaction code A indicates grant, award or other acquisition of securities from the company.

Check Out The Full List Of Zurn Elkay Water's Insider Trades.

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