Insider Transaction: Mark Newcomer Sells $316K Worth Of PaySign Shares

Disclosed on August 7, Mark Newcomer, CEO at PaySign PAYS, executed a substantial insider sell as per the latest SEC filing.

What Happened: After conducting a thorough analysis, Newcomer sold 69,593 shares of PaySign. This information was disclosed in a Form 4 filing with the U.S. Securities and Exchange Commission on Wednesday. The total transaction value is $316,000.

At Wednesday morning, PaySign shares are down by 0.0%, trading at $4.63.

Discovering PaySign: A Closer Look

PaySign Inc is a provider of prepaid card programs, comprehensive patient affordability offerings, digital banking services, and integrated payment processing designed for businesses, consumers, and government institutions. The Company creates customized, payment solutions for clients across industries, including pharmaceutical, healthcare, hospitality, and retail. The company's revenues include fees generated from cardholder fees, interchange, card program management fees, transaction claims processing fees, and settlement income.

Financial Milestones: PaySign's Journey

Revenue Growth: PaySign's remarkable performance in 3 months is evident. As of 30 June, 2024, the company achieved an impressive revenue growth rate of 29.8%. This signifies a substantial increase in the company's top-line earnings. As compared to competitors, the company surpassed expectations with a growth rate higher than the average among peers in the Financials sector.

Analyzing Profitability Metrics:

• Gross Margin: The company shows a low gross margin of 52.93%, suggesting potential challenges in cost control and profitability compared to its peers.

• Earnings per Share (EPS): With an EPS below industry norms, PaySign exhibits below-average bottom-line performance with a current EPS of 0.01.

Debt Management: With a below-average debt-to-equity ratio of 0.12, PaySign adopts a prudent financial strategy, indicating a balanced approach to debt management.

Understanding Financial Valuation:

• Price to Earnings (P/E) Ratio: With a lower-than-average P/E ratio of 30.8, the stock indicates an attractive valuation, potentially presenting a buying opportunity.

• Price to Sales (P/S) Ratio: The current P/S ratio of 4.8 is above industry norms, reflecting an elevated valuation for PaySign's stock and potential overvaluation based on sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): With an EV/EBITDA ratio of 35.99, the company's market valuation exceeds industry averages.

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.

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

Why Insider Activity Matters in Finance

Insider transactions shouldn't be used primarily to make an investing decision, however, they can be an important factor for an investor to consider.

Within the legal framework, an "insider" is defined as any officer, director, or beneficial owner holding more than ten percent of a company's equity securities as per 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.

The initiation of a new purchase by a company insider serves as a strong indication that they expect the stock to rise.

However, insider sells may not always signal a bearish view and can be influenced by various factors.

A Deep Dive into 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 PaySign's Insider Trades.

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