Chemed Executive Vice President Trades Company's Stock

Disclosed on August 1, Nicholas M. Westfall, Executive Vice President at Chemed CHE, executed a substantial insider sell as per the latest SEC filing.

What Happened: A Form 4 filing with the U.S. Securities and Exchange Commission on Thursday outlined that Westfall executed a sale of 2,000 shares of Chemed with a total value of $1,123,160.

Tracking the Friday's morning session, Chemed shares are trading at $588.44, showing a down of 0.0%.

About Chemed

Chemed Corp operates subsidiaries in two main segments: VITAS and Roto-Rooter. The VITAS segment generates the majority of the firm's revenue. It provides hospice and palliative care services to patients with terminal illnesses through a network of physicians, registered nurses, home health aides, social workers, and volunteers. The vast majority of the segment's revenue is received from the Medicare and Medicaid reimbursement programs. The Roto-Rooter segment provides plumbing, drain cleaning, water restoration, and related services to residential and commercial customers. Chemed generates the majority of its revenue from business in the United States.

Financial Milestones: Chemed's Journey

Revenue Growth: Over the 3 months period, Chemed showcased positive performance, achieving a revenue growth rate of 7.6% as of 30 June, 2024. This reflects a substantial 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.

Exploring Profitability:

• Gross Margin: The company sets a benchmark with a high gross margin of 34.59%, reflecting superior cost management and profitability compared to its peers.

• Earnings per Share (EPS): Chemed's EPS outshines the industry average, indicating a strong bottom-line trend with a current EPS of 4.7.

Debt Management: Chemed's debt-to-equity ratio is below industry norms, indicating a sound financial structure with a ratio of 0.12.

In-Depth Valuation Examination:

• Price to Earnings (P/E) Ratio: Chemed's P/E ratio of 29.82 is below the industry average, suggesting the stock may be undervalued.

• Price to Sales (P/S) Ratio: The current P/S ratio of 3.85 is above industry norms, reflecting an elevated valuation for Chemed's stock and potential overvaluation based on sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): The company's EV/EBITDA ratio 19.38 is below the industry average, indicating that it may be relatively undervalued compared to peers.

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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Illuminating the Importance of Insider Transactions

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

Exploring the legal landscape, an "insider" is defined as any officer, director, or beneficial owner holding more than ten percent of a company's equity securities, as stipulated by Section 12 of the Securities Exchange Act of 1934. This encompasses executives in the c-suite and major hedge funds. These insiders are required to report their transactions through a Form 4 filing, which must be submitted within two business days of the transaction.

Highlighted by a company insider's new purchase, there's a positive anticipation for the stock to rise.

But, insider sells may not necessarily indicate a bearish view and can be motivated by various factors.

Transaction Codes To Focus On

When analyzing 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 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 Chemed's Insider Trades.

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