Kang Jyh Lee Executes Sell Order: Offloads $421K In Photronics Stock

Kang Jyh Lee, Chief Executive Officer at Photronics PLAB, executed a substantial insider sell on January 6, according to an SEC filing.

What Happened: A Form 4 filing from the U.S. Securities and Exchange Commission on Monday showed that Lee sold 17,500 shares of Photronics. The total transaction amounted to $421,750.

Tracking the Tuesday's morning session, Photronics shares are trading at $24.58, showing a up of 0.04%.

All You Need to Know About Photronics

Photronics Inc is a U.S.-based company that is principally engaged in manufacturing photomasks. The photomasks are photographic quartz or glass plates that contain microscopic images of electronic circuits that are used as a component in the manufacture of integrated circuits and flat-panel displays. The revenue from products designed for integrated circuits production accounts for the majority of total revenue, with the rest derived from products for flat-panel display production. The company's assets are located in Taiwan, Korea, and the United States. It generates revenue world-wide, including in the United States, Europe, Taiwan, Korea, China, and elsewhere in Asia, with Taiwan contributing the majority of total revenue.

Understanding the Numbers: Photronics's Finances

Negative Revenue Trend: Examining Photronics's financials over 3 months reveals challenges. As of 31 October, 2024, the company experienced a decline of approximately -2.13% in revenue growth, reflecting a decrease in 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 Information Technology sector.

Profitability Metrics: Unlocking Value

• Gross Margin: The company shows a low gross margin of 36.97%, indicating concerns regarding cost management and overall profitability relative to its industry counterparts.

• Earnings per Share (EPS): With an EPS below industry norms, Photronics exhibits below-average bottom-line performance with a current EPS of 0.55.

Debt Management: Photronics's debt-to-equity ratio is below the industry average. With a ratio of 0.02, the company relies less on debt financing, maintaining a healthier balance between debt and equity, which can be viewed positively by investors.

Analyzing Market Valuation:

• Price to Earnings (P/E) Ratio: With a lower-than-average P/E ratio of 11.76, the stock indicates an attractive valuation, potentially presenting a buying opportunity.

• Price to Sales (P/S) Ratio: With a lower-than-average P/S ratio of 1.77, the stock presents an attractive valuation, potentially signaling a buying opportunity for investors interested in sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): With an EV/EBITDA ratio lower than industry averages at 2.84, Photronics could be considered undervalued.

Market Capitalization: Indicating a reduced size compared to industry averages, the company's market capitalization poses unique challenges.

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The Relevance of Insider Transactions

Insightful as they may be, insider transactions should be considered alongside a thorough examination of other investment criteria.

In legal terms, an "insider" refers to any officer, director, or beneficial owner of more than ten percent of a company's equity securities registered under Section 12 of the Securities Exchange Act of 1934. This can include executives in the c-suite and large hedge funds. These insiders are required to let the public know of their transactions via a Form 4 filing, which must be filed within two business days of the transaction.

When a company insider makes a new purchase, that is an indication that they expect the stock to rise.

Insider sells, on the other hand, can be made for a variety of reasons, and may not necessarily mean that the seller thinks the stock will go down.

Transaction Codes Worth Your Attention

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 Photronics's Insider Trades.

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