Insider Decision: ROBERT BLAIR Offloads $201K Worth Of Super Micro Computer Stock

It was reported on December 7, that ROBERT BLAIR, Board Member at Super Micro Computer SMCI executed a significant insider sell, according to an SEC filing.

What Happened: According to a Form 4 filing with the U.S. Securities and Exchange Commission on Thursday, BLAIR sold 800 shares of Super Micro Computer. The total transaction value is $201,740.

Super Micro Computer shares are trading down 0.45% at $255.0 at the time of this writing on Friday morning.

Unveiling the Story Behind Super Micro Computer

Super Micro Computer Inc provides high-performance server technology services to cloud computing, data center, Big Data, high-performance computing, and "Internet of Things" embedded markets. Its solutions include server, storage, blade and workstations to full racks, networking devices, and server management software. The firm follows a modular architectural approach, which provides flexibility to deliver customized solutions. The Company operates in one operating segment that develops and provides high-performance server solutions based upon an innovative, modular and open-standard architecture. More than half of the firm's revenue is generated in the United States, with the rest coming from Europe, Asia, and other regions.

Super Micro Computer's Economic Impact: An Analysis

Revenue Growth: Super Micro Computer displayed positive results in 3 months. As of 30 September, 2023, the company achieved a solid revenue growth rate of approximately 14.45%. This indicates a notable 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.

Insights into Profitability:

• Gross Margin: With a low gross margin of 16.69%, the company exhibits below-average profitability, signaling potential struggles in cost efficiency compared to its industry peers.

• Earnings per Share (EPS): Super Micro Computer's EPS outshines the industry average, indicating a strong bottom-line trend with a current EPS of 2.96.

Debt Management: The company maintains a balanced debt approach with a debt-to-equity ratio below industry norms, standing at 0.07.

Exploring Valuation Metrics Landscape:

• Price to Earnings (P/E) Ratio: The Price to Earnings ratio of 23.65 is lower than the industry average, indicating potential undervaluation for the stock.

• Price to Sales (P/S) Ratio: A higher-than-average P/S ratio of 1.96 suggests overvaluation in the eyes of investors, considering sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): With an EV/EBITDA ratio of 18.53, the company's market valuation exceeds industry averages.

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.

Now trade stocks online commission free with Charles Schwab, a trusted and complete investment firm.

Illuminating the Importance of Insider Transactions

Considering insider transactions is valuable, but it's crucial to evaluate them in conjunction with other investment factors.

When discussing 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 stipulated in Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and significant hedge funds. Such insiders are required to report their transactions through a Form 4 filing, which must be completed within two business days of the transaction.

A new purchase by a company insider is a indication that they anticipate the stock will rise.

On the other hand, insider sells may not necessarily indicate a bearish view and can be motivated by various factors.

Deciphering Transaction Codes in Insider Filings

Surveying the realm of stock transactions, investors often give prominence to those unfolding in the open market, systematically detailed in Table I of the Form 4 filing. A P in Box 3 indicates a purchase, while S signifies a sale. Transaction code C denotes 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 Super Micro Computer's Insider Trades.

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