Director Of Bentley Systems Purchased $72K In Stock

A significant insider buy by Keith Bentley, Director at Bentley Systems BSY, was executed on January 25, and reported in the recent SEC filing.

What Happened: In a significant move reported in a Form 4 filing with the U.S. Securities and Exchange Commission on Thursday, Bentley purchased 1,430 shares of Bentley Systems, demonstrating confidence in the company's growth potential. The total value of the transaction stands at $72,658.

The latest market snapshot at Friday morning reveals Bentley Systems shares up by 0.1%, trading at $50.1.

About Bentley Systems

Bentley Systems is a software vendor that caters to engineers, architects, constructors, and geospatial professionals by enabling design, modeling, simulation and project, and data management of infrastructure assets. The firm delivers solutions via the cloud, desktop, and hybrid environments. While Bentley is relatively small in comparison with peers like Autodesk, it shines in core specialty areas, like bridge or rail design, as opposed to being more broad-based in its applications. As of fiscal 2022, approximately 58% of revenue is derived from outside the U.S. (with 28% of revenue coming from EMEA and 18% coming from APAC as of fiscal 2022). Bentley's largest end market is the public works and utilities sector, which represents approximately two thirds of revenue.

Key Indicators: Bentley Systems's Financial Health

Positive Revenue Trend: Examining Bentley Systems's financials over 3 months reveals a positive narrative. The company achieved a noteworthy revenue growth rate of 14.27% as of 30 September, 2023, showcasing a substantial increase in top-line earnings. As compared to competitors, the company surpassed expectations with a growth rate higher than the average among peers in the Information Technology sector.

Exploring Profitability:

• Gross Margin: The company maintains a high gross margin of 78.91%, indicating strong cost management and profitability compared to its peers.

• Earnings per Share (EPS): With an EPS below industry norms, Bentley Systems exhibits below-average bottom-line performance with a current EPS of 0.17.

Debt Management: Bentley Systems's debt-to-equity ratio stands notably higher than the industry average, reaching 2.36. This indicates a heavier reliance on borrowed funds, raising concerns about financial leverage.

Analyzing Market Valuation:

• Price to Earnings (P/E) Ratio: The current P/E ratio of 90.98 is below industry norms, indicating potential undervaluation and presenting an investment opportunity.

• Price to Sales (P/S) Ratio: With a higher-than-average P/S ratio of 13.78, Bentley Systems'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): With a below-average EV/EBITDA ratio of 50.65, Bentley Systems presents an opportunity for value investors. This lower valuation may attract investors seeking undervalued opportunities.

Market Capitalization Analysis: Below industry benchmarks, the company's market capitalization reflects a smaller scale relative to peers. This could be attributed to factors such as growth expectations or operational capacity.

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The Importance of Insider Transactions

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

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.

Transaction Codes To Focus On

For investors, a primary focus lies on transactions occurring in the open market, as indicated in Table I of the Form 4 filing. A P in Box 3 denotes 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 Bentley Systems's Insider Trades.

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