CEO At Federated Hermes Sells $215K Of Stock

Anwar Saker Nusseibeh, CEO at Federated Hermes FHI, reported an insider sell on February 10, according to a new SEC filing.

What Happened: A Form 4 filing with the U.S. Securities and Exchange Commission on Monday outlined that Nusseibeh executed a sale of 5,546 shares of Federated Hermes with a total value of $215,220.

As of Tuesday morning, Federated Hermes shares are down by 1.1%, currently priced at $37.86.

About Federated Hermes

Federated Hermes provides asset-management services for institutional and individual investors. The firm had $800 billion in managed assets at the end of September 2024, composed of equity (10%), multi-asset (less than 1%), fixed-income (12%), alternative (3%), and money market (74%) funds. The firm's cash-management operations are expected to generate around 51% of Federated's revenue this year, compared with 29%, 12%, and 7%, respectively, for the equity, fixed-income, and alternatives/multi-asset operations. The company's products are distributed via trust banks, wealth managers, and retail broker/dealers (65% of AUM), institutional investors (26%), and international clients (9%).

Federated Hermes's Economic Impact: An Analysis

Revenue Growth: Federated Hermes displayed positive results in 3 months. As of 31 December, 2024, the company achieved a solid revenue growth rate of approximately 3.97%. This indicates a notable increase in the company's top-line earnings. In comparison to its industry peers, the company trails behind with a growth rate lower than the average among peers in the Financials sector.

Key Profitability Indicators:

• Gross Margin: The company maintains a high gross margin of 67.7%, indicating strong cost management and profitability compared to its peers.

• Earnings per Share (EPS): Federated Hermes's EPS lags behind the industry average, indicating concerns and potential challenges with a current EPS of 1.04.

Debt Management: Federated Hermes's debt-to-equity ratio is below the industry average. With a ratio of 0.32, the company relies less on debt financing, maintaining a healthier balance between debt and equity, which can be viewed positively by investors.

Valuation Analysis:

• Price to Earnings (P/E) Ratio: The Price to Earnings ratio of 11.85 is lower than the industry average, indicating potential undervaluation for the stock.

• Price to Sales (P/S) Ratio: With a lower-than-average P/S ratio of 1.86, 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): The company's EV/EBITDA ratio of 7.2 trails industry averages, indicating a potential disparity in market valuation that could be advantageous for investors.

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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Uncovering the Importance of Insider Activity

In the complex landscape of investment decisions, investors should approach insider transactions as part of a comprehensive analysis, considering various elements.

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.

The Insider's Guide to Important Transaction Codes

When it comes to transactions, investors tend to focus on those in the open market, detailed in Table I of the Form 4 filing. A P in Box 3 denotes a purchase, while S indicates 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 Federated Hermes's Insider Trades.

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