Insider Move: Steven J Orlando Invests $55K In Molina Healthcare Stock

Disclosed in the latest SEC filing, a significant insider purchase on January 2, involves Steven J Orlando, Director at Molina Healthcare MOH.

What Happened: Orlando made a significant move by purchasing 189 shares of Molina Healthcare as reported in a Form 4 filing with the U.S. Securities and Exchange Commission. The transaction's total worth stands at $55,008.

Molina Healthcare shares are trading down 0.0% at $287.24 at the time of this writing on Friday morning.

About Molina Healthcare

Molina Healthcare Inc offers healthcare plans focused on Medicaid-related solutions for low-income families and individuals. Its health plans are operated by a network of subsidiaries, each of which is licensed as a health maintenance organization (HMO). It has four segments: Medicaid, Medicare, Marketplace and Others. The Medicaid, Medicare, and Marketplace segments represent the government-funded or sponsored programs under which it offers managed healthcare services. The Other segment, which is insignificant to its consolidated results of operations, includes long-term services and supports consultative services in Wisconsin. It generates majority revenue from Medicaid segment.

Understanding the Numbers: Molina Healthcare's Finances

Revenue Growth: Over the 3 months period, Molina Healthcare showcased positive performance, achieving a revenue growth rate of 20.96% as of 30 September, 2024. This reflects a substantial 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 Health Care sector.

Evaluating Earnings Performance:

• Gross Margin: The company shows a low gross margin of 11.5%, suggesting potential challenges in cost control and profitability compared to its peers.

• Earnings per Share (EPS): Molina Healthcare's EPS is significantly higher than the industry average. The company demonstrates a robust bottom-line performance with a current EPS of 5.67.

Debt Management: Molina Healthcare's debt-to-equity ratio is notably higher than the industry average. With a ratio of 0.53, the company relies more heavily on borrowed funds, indicating a higher level of financial risk.

Financial Valuation:

• Price to Earnings (P/E) Ratio: The P/E ratio of 14.61 is lower than the industry average, implying a discounted valuation for Molina Healthcare's stock.

• Price to Sales (P/S) Ratio: The Price to Sales ratio is 0.43, 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): With a below-average EV/EBITDA ratio of 5.34, Molina Healthcare presents an opportunity for value investors. This lower valuation may attract investors seeking undervalued opportunities.

Market Capitalization Analysis: Below industry benchmarks, the company's market capitalization reflects a smaller scale relative to peers. This could be attributed to factors such as growth expectations or operational capacity.

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Why Pay Attention to Insider Transactions

Investors should view insider transactions as part of a multifaceted analysis and not rely solely on them for decision-making.

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.

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 Molina Healthcare's Insider Trades.

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