Insider Selling: Bruce Rothstein Unloads $2.94M Of Cactus Stock

A substantial insider sell was reported on November 20, by Bruce Rothstein, Director at Cactus WHD, based on the recent SEC filing.

What Happened: After conducting a thorough analysis, Rothstein sold 45,000 shares of Cactus. This information was disclosed in a Form 4 filing with the U.S. Securities and Exchange Commission on Wednesday. The total transaction value is $2,935,125.

Cactus's shares are actively trading at $65.29, experiencing a down of 0.0% during Thursday's morning session.

About Cactus

Cactus Inc is engaged in the designing, manufacturing, and sale of wellheads and pressure control equipment. Its principal products include Cactus SafeDrill wellhead systems, conventional wellheads, and production valves among others. The company also provides mission-critical field services, including service crews to assist with the installation, maintenance, and safe handling of the wellhead and pressure control equipment, as well as repair services for equipment that it sells or rents. It sells or rents its products principally for onshore unconventional oil and gas wells that are utilized during the drilling, completion (including fracturing), and production. The company has two operating segments; Pressure Control , which generates key revenue and Spoolable Technologies.

Cactus's Economic Impact: An Analysis

Revenue Growth: Over the 3 months period, Cactus showcased positive performance, achieving a revenue growth rate of 1.84% as of 30 September, 2024. This reflects a substantial increase in the company's top-line earnings. When compared to others in the Energy sector, the company faces challenges, achieving a growth rate lower than the average among peers.

Analyzing Profitability Metrics:

• Gross Margin: With a high gross margin of 38.99%, the company demonstrates effective cost control and strong profitability relative to its peers.

• Earnings per Share (EPS): Cactus's EPS is significantly higher than the industry average. The company demonstrates a robust bottom-line performance with a current EPS of 0.75.

Debt Management: With a below-average debt-to-equity ratio of 0.04, Cactus adopts a prudent financial strategy, indicating a balanced approach to debt management.

Insights into Valuation Metrics:

• Price to Earnings (P/E) Ratio: The P/E ratio of 22.99 is lower than the industry average, implying a discounted valuation for Cactus's stock.

• Price to Sales (P/S) Ratio: With a relatively high Price to Sales ratio of 4.59 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): With an EV/EBITDA ratio of 11.24, the company's market valuation exceeds industry averages.

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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Illuminating the Importance of Insider Transactions

Insider transactions shouldn't be used primarily to make an investing decision, however, they can be an important factor for an investor to consider.

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.

Cracking 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 Cactus's Insider Trades.

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