Insider Unloading: Kathryn Schoenrock Sells Options, Realizes $158K

Highlighted on November 27, it was unveiled in an SEC filing that Schoenrock, EVP at Graco GGG, executed a significant transaction involving the exercise of company stock options.

What Happened: In an insider options sale disclosed in a Form 4 filing on Wednesday with the U.S. Securities and Exchange Commission, Schoenrock, EVP at Graco, exercised stock options for 2,415 shares of GGG. The transaction value amounted to $158,826.

Graco shares are currently trading down by 0.06%, with a current price of $90.56 as of Thursday morning. This brings the total value of Schoenrock's 2,415 shares to $158,826.

Delving into Graco's Background

Graco manufactures equipment used for managing fluids, coatings, and adhesives, specializing in difficult-to-handle materials. Graco's business is organized into three segments: industrial, process, and contractor. The Minnesota-based firm serves a wide range of end markets, including industrial, automotive, and construction, and its broad array of products include pumps, valves, meters, sprayers, and equipment used to apply coatings, sealants, and adhesives. The firm generated roughly $2.2 billion in sales in 2023.

Financial Insights: Graco

Decline in Revenue: Over the 3 months period, Graco faced challenges, resulting in a decline of approximately -3.79% in revenue growth as of 30 September, 2024. This signifies a reduction in the company's top-line earnings. As compared to its peers, the revenue growth lags behind its industry peers. The company achieved a growth rate lower than the average among peers in Industrials sector.

Navigating Financial Profits:

• Gross Margin: With a high gross margin of 53.18%, the company demonstrates effective cost control and strong profitability relative to its peers.

• Earnings per Share (EPS): Graco's EPS lags behind the industry average, indicating concerns and potential challenges with a current EPS of 0.72.

Debt Management: The company maintains a balanced debt approach with a debt-to-equity ratio below industry norms, standing at 0.02.

In-Depth Valuation Examination:

• Price to Earnings (P/E) Ratio: A higher-than-average P/E ratio of 32.02 suggests caution, as the stock may be overvalued in the eyes of investors.

• Price to Sales (P/S) Ratio: A higher-than-average P/S ratio of 7.32 suggests overvaluation in the eyes of investors, considering sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): With an EV/EBITDA ratio of 21.79, the company's market valuation exceeds industry averages.

Market Capitalization Analysis: Reflecting a smaller scale, the company's market capitalization is positioned below industry averages. This could be attributed to factors such as growth expectations or operational capacity.

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Why Insider Activity Matters in Finance

Insider transactions serve as a piece of the puzzle in investment decisions, rather than the entire picture.

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

Notably, when a company insider makes a new purchase, it is considered an indicator of their positive expectations for the stock.

Conversely, insider sells may not necessarily signal a bearish stance on the stock and can be motivated by various factors.

Navigating the World of Insider Transaction Codes

Delving into transactions, investors typically prioritize those unfolding in the open market, as precisely outlined in Table I of the Form 4 filing. A P in Box 3 indicates a purchase, while S signifies a sale. Transaction code C signals 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 Graco's Insider Trades.

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