Insider Decision: McWILLIAMS ALAN REID Offloads $585K Worth Of Sanmina Stock

On August 8, a recent SEC filing unveiled that McWILLIAMS ALAN REID, EVP at Sanmina SANM made an insider sell.

What Happened: REID's decision to sell 8,500 shares of Sanmina was revealed in a Form 4 filing with the U.S. Securities and Exchange Commission on Thursday. The total value of the sale is $585,252.

Monitoring the market, Sanmina's shares down by 0.0% at $70.17 during Friday's morning.

Delving into Sanmina's Background

Sanmina Corp is a provider of integrated manufacturing solutions, components, and after-market services to original equipment manufacturers in the communications networks, storage, industrial, defense and aerospace end markets. The company operates in two business segments: Integrated Manufacturing Solutions, which consists of printed circuit board assembly and represents a majority of the firm's revenue; and Components, Products, and Services, which includes interconnect systems and mechanical systems. The firm generates revenue primarily in the United States, China, and Mexico, but has a presence around the world.

Sanmina's Economic Impact: An Analysis

Revenue Challenges: Sanmina's revenue growth over 3 months faced difficulties. As of 30 June, 2024, the company experienced a decline of approximately -16.57%. This indicates a decrease in top-line earnings. In comparison to its industry peers, the company trails behind with a growth rate lower than the average among peers in the Information Technology sector.

Key Insights into Profitability Metrics:

• Gross Margin: The company shows a low gross margin of 8.34%, indicating concerns regarding cost management and overall profitability relative to its industry counterparts.

• Earnings per Share (EPS): Sanmina's EPS outshines the industry average, indicating a strong bottom-line trend with a current EPS of 0.93.

Debt Management: Sanmina's debt-to-equity ratio is below industry norms, indicating a sound financial structure with a ratio of 0.15.

Navigating Market Valuation:

• Price to Earnings (P/E) Ratio: With a lower-than-average P/E ratio of 18.18, the stock indicates an attractive valuation, potentially presenting a buying opportunity.

• Price to Sales (P/S) Ratio: The P/S ratio of 0.53 is lower than the industry average, implying a discounted valuation for Sanmina'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 7.41 is below the industry average, indicating that it may be relatively undervalued compared to peers.

Market Capitalization: Positioned above industry average, the company's market capitalization underscores its superiority in size, indicative of a strong market presence.

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Uncovering the Importance of Insider Activity

In the complex landscape of investment decisions, investors should approach insider transactions as part of a comprehensive analysis, considering various elements.

In legal terms, an "insider" refers to any officer, director, or beneficial owner of more than ten percent of a company's equity securities registered under Section 12 of the Securities Exchange Act of 1934. This can include executives in the c-suite and large hedge funds. These insiders are required to let the public know of their transactions via a Form 4 filing, which must be filed within two business days of the transaction.

When a company insider makes a new purchase, that is an indication that they expect the stock to rise.

Insider sells, on the other hand, can be made for a variety of reasons, and may not necessarily mean that the seller thinks the stock will go down.

Navigating the World of Insider Transaction Codes

When dissecting transactions, the focal point for investors is often those occurring in the open market, meticulously 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 indicates 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 Sanmina's Insider Trades.

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