Insider Unloading: Steven J Orlando Sells $339K Worth Of Molina Healthcare Shares

A substantial insider sell was reported on July 30, by Steven J Orlando, Board Member at Molina Healthcare MOH, based on the recent SEC filing.

What Happened: Orlando's recent move involves selling 1,000 shares of Molina Healthcare. This information is documented in a Form 4 filing with the U.S. Securities and Exchange Commission on Tuesday. The total value is $339,210.

The latest update on Wednesday morning shows Molina Healthcare shares down by 1.64%, trading at $344.99.

Unveiling the Story Behind Molina Healthcare

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). It has four segments: Medicaid, Medicare, Marketplace and Others. The Medicaid, Medicare, and Marketplace segments represent the government-funded or sponsored programs under which it offers managed healthcare services. The Other segment, which is insignificant to its consolidated results of operations, includes long-term services and supports consultative services in Wisconsin. It generates majority revenue from Medicaid segment.

Molina Healthcare: Delving into Financials

Revenue Growth: Molina Healthcare displayed positive results in 3 months. As of 30 June, 2024, the company achieved a solid revenue growth rate of approximately 18.65%. This indicates a notable increase in the company's top-line earnings. When compared to others in the Health Care sector, the company excelled with a growth rate higher than the average among peers.

Evaluating Earnings Performance:

• Gross Margin: The company issues a cost efficiency warning with a low gross margin of 12.29%, indicating potential difficulties in maintaining profitability compared to its peers.

• Earnings per Share (EPS): Molina Healthcare's EPS is notably higher than the industry average. The company achieved a positive bottom-line trend with a current EPS of 5.18.

Debt Management: Molina Healthcare's debt-to-equity ratio stands notably higher than the industry average, reaching 0.49. This indicates a heavier reliance on borrowed funds, raising concerns about financial leverage.

Valuation Overview:

• Price to Earnings (P/E) Ratio: The current P/E ratio of 19.24 is below industry norms, indicating potential undervaluation and presenting an investment opportunity.

• Price to Sales (P/S) Ratio: The P/S ratio of 0.55 is lower than the industry average, implying a discounted valuation for Molina Healthcare's stock in relation to sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): The company's EV/EBITDA ratio of 8.32 trails industry averages, indicating a potential disparity in market valuation that could be advantageous for investors.

Market Capitalization Analysis: The company's market capitalization is below the industry average, suggesting that it is relatively smaller compared to peers. This could be due to various factors, including perceived growth potential or operational scale.

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Exploring the Significance of Insider Trading

Insider transactions shouldn't be used primarily to make an investing decision, however an insider transaction can be an important factor in the investing decision.

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.

Navigating the World of Insider Transaction Codes

Taking a closer look at transactions, investors often prioritize those unfolding in the open market, meticulously cataloged in Table I of the Form 4 filing. A P in Box 3 denotes a purchase, while S signifies a sale. Transaction code C denotes the conversion of an option, and transaction code A signifies 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.