Director Of Molina Healthcare Makes $54K Buy

A significant insider buy by Steven J Orlando, Director at Molina Healthcare MOH, was executed on January 3, and reported in the recent SEC filing.

What Happened: Orlando demonstrated confidence in Molina Healthcare by purchasing 152 shares, as reported in a Form 4 filing with the U.S. Securities and Exchange Commission on Wednesday. The total value of the transaction is $54,919.

Monitoring the market, Molina Healthcare's shares up by 0.89% at $374.83 during Wednesday's morning.

Get to Know Molina Healthcare Better

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). In addition to its Health Plans segment, Molina has a Medicaid,Medicare, and Marketplace segment that represent the government-funded or sponsored programs under their management information systems. Molina's Medicaid plans receive revenue on a per-member per-month basis from state government agencies, and its Medicare Advantage plans receive revenue from managed care plans that contract with the Centers for Medicaid and Medicare (CMS). Molina also provides plans through health insurance exchanges.

Understanding the Numbers: Molina Healthcare's Finances

Revenue Growth: Molina Healthcare's revenue growth over a period of 3 months has been noteworthy. As of 30 September, 2023, the company achieved a revenue growth rate of approximately 7.83%. This indicates a substantial increase in the company's top-line earnings. When compared to others in the Health Care sector, the company faces challenges, achieving a growth rate lower than the average among peers.

Interpreting Earnings Metrics:

• Gross Margin: The company shows a low gross margin of 12.47%, indicating concerns regarding cost management and overall profitability relative to its industry counterparts.

• 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 4.24.

Debt Management: Molina Healthcare's debt-to-equity ratio is notably higher than the industry average. With a ratio of 0.61, the company relies more heavily on borrowed funds, indicating a higher level of financial risk.

Financial Valuation:

• Price to Earnings (P/E) Ratio: Molina Healthcare's P/E ratio of 23.15 is below the industry average, suggesting the stock may be undervalued.

• Price to Sales (P/S) Ratio: The current P/S ratio of 0.65 is below industry norms, suggesting potential undervaluation and presenting an investment opportunity for those considering sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): At 9.34, Molina Healthcare's EV/EBITDA ratio reflects a below-par valuation compared to industry averages signalling undervaluation

Market Capitalization Perspectives: The company's market capitalization falls below industry averages, signaling a relatively smaller size compared to peers. This positioning may be influenced by factors such as perceived growth potential or operational scale.

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Unmasking the Significance of Insider Transactions

Insider transactions contribute to decision-making but should be supplemented by a comprehensive investment analysis.

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.

Exploring Key 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 Molina Healthcare's Insider Trades.

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