Mandeep Chawla Takes Money Off The Table, Sells $1.21M In Celestica Stock

Revealing a significant insider sell on February 4, Mandeep Chawla, Chief Financial Officer at Celestica CLS, as per the latest SEC filing.

What Happened: According to a Form 4 filing with the U.S. Securities and Exchange Commission on Tuesday, Chawla sold 9,483 shares of Celestica. The total transaction value is $1,209,461.

Monitoring the market, Celestica's shares up by 0.89% at $121.96 during Tuesday's morning.

Unveiling the Story Behind Celestica

Celestica Inc offers supply chain solutions. The company has two operating and reportable segments: Advanced Technology Solutions (ATS) and Connectivity & Cloud Solutions (CCS). The ATS segment consists of the ATS end market and is comprised of the Aerospace and Defense, Industrial, health tech, and Capital Equipment businesses. Its Capital Equipment business is comprised of the semiconductor, display, and robotics equipment businesses, and the CCS segment consists of Communications and Enterprise end markets, Enterprise end market is comprised of its servers and storage businesses. The company generates a majority of its revenue from the Connectivity & Cloud Solutions segment.

A Deep Dive into Celestica's Financials

Revenue Growth: Celestica's revenue growth over a period of 3 months has been noteworthy. As of 31 December, 2024, the company achieved a revenue growth rate of approximately 1.85%. This indicates a substantial increase in the company's top-line earnings. As compared to its peers, the company achieved a growth rate higher than the average among peers in Information Technology sector.

Holistic Profitability Examination:

• Gross Margin: With a low gross margin of 11.67%, the company exhibits below-average profitability, signaling potential struggles in cost efficiency compared to its industry peers.

• Earnings per Share (EPS): Celestica's EPS is a standout, portraying a positive bottom-line trend that exceeds the industry average with a current EPS of 1.3.

Debt Management: With a below-average debt-to-equity ratio of 0.42, Celestica adopts a prudent financial strategy, indicating a balanced approach to debt management.

Market Valuation:

• Price to Earnings (P/E) Ratio: Celestica's P/E ratio of 33.48 is below the industry average, suggesting the stock may be undervalued.

• Price to Sales (P/S) Ratio: With a higher-than-average P/S ratio of 1.49, Celestica'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): A high EV/EBITDA ratio of 19.67 reflects market recognition of Celestica's value, positioning it as more highly valued compared to industry peers.

Market Capitalization Highlights: Above the industry average, the company's market capitalization signifies a significant scale, indicating strong confidence and market prominence.

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Why Insider Transactions Are Important

While insider transactions provide valuable information, they should be part of a broader analysis in making investment decisions.

In the context of legal matters, the term "insider" refers to any officer, director, or beneficial owner holding more than ten percent of a company's equity securities, as outlined by Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and significant hedge funds. Such insiders are obligated to report their transactions through a Form 4 filing, which must be completed 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.

Despite insider sells not always signaling a bearish sentiment, they can be driven by various factors.

Important Transaction Codes

When dissecting transactions, the focal point for investors is often those occurring in the open market, meticulously detailed in Table I of the Form 4 filing. A P in Box 3 denotes a purchase, while S signifies a sale. Transaction code C indicates 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 Celestica's Insider Trades.

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