Insider Decision: Virginia Halloran Offloads $307K Worth Of Watts Water Technologies Stock

On March 15, a recent SEC filing unveiled that Virginia Halloran, Chief Accounting Officer at Watts Water Technologies WTS made an insider sell.

What Happened: A Form 4 filing with the U.S. Securities and Exchange Commission on Friday outlined that Halloran executed a sale of 1,520 shares of Watts Water Technologies with a total value of $307,207.

The latest market snapshot at Friday morning reveals Watts Water Technologies shares down by 0.0%, trading at $202.39.

About Watts Water Technologies

Watts Water Technologies Inc is a U.S.-based company that provides safety, energy efficiency, and water conservation products. Its product portfolio includes residential and commercial flow control products, which are sold for plumbing and hot water applications; HVAC and gas products, including commercial boilers, water heaters, heating solutions, and heating systems; drainage and water reuse products, including drainage products and engineered rainwater-harvesting solutions; and water quality products, including point-of-use and point-of-entry water filtration, conditioning, and scale prevention systems. The company generates the majority of its revenue from markets in the Americas and in Europe, the Middle East, and Africa.

Watts Water Technologies: A Financial Overview

Revenue Growth: Over the 3 months period, Watts Water Technologies showcased positive performance, achieving a revenue growth rate of 9.09% as of 31 December, 2023. This reflects a substantial increase in the company's top-line earnings. As compared to competitors, the company encountered difficulties, with a growth rate lower than the average among peers in the Industrials sector.

Analyzing Profitability Metrics:

• Gross Margin: The company sets a benchmark with a high gross margin of 46.68%, reflecting superior cost management and profitability compared to its peers.

• Earnings per Share (EPS): Watts Water Technologies's EPS outshines the industry average, indicating a strong bottom-line trend with a current EPS of 1.67.

Debt Management: Watts Water Technologies's debt-to-equity ratio is below the industry average at 0.2, reflecting a lower dependency on debt financing and a more conservative financial approach.

Valuation Overview:

• Price to Earnings (P/E) Ratio: The P/E ratio of 25.88 is lower than the industry average, implying a discounted valuation for Watts Water Technologies's stock.

• Price to Sales (P/S) Ratio: The P/S ratio of 3.3 is lower than the industry average, implying a discounted valuation for Watts Water Technologies's stock in relation to sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): With an EV/EBITDA ratio lower than industry averages at 16.68, Watts Water Technologies could be considered undervalued.

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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Illuminating the Importance of Insider Transactions

It's important to note that insider transactions alone should not dictate investment decisions, but they can provide valuable insights.

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.

Understanding Crucial 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 Watts Water Technologies's Insider Trades.

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