Options Exercise: Rizwan Jamal At Affiliated Managers Group Realizes $41.04M

In a new SEC filing on August 20, it was revealed that Jamal, Head Affiliate Investments at Affiliated Managers Group AMG, executed a significant exercise of company stock options.

What Happened: Disclosed in a Form 4 filing on Tuesday with the U.S. Securities and Exchange Commission, Jamal, Head Affiliate Investments at Affiliated Managers Group, executed a strategic derivative sale. This involved exercising stock options for 428,807 shares of AMG, resulting in a transaction value of $41,036,829.

Affiliated Managers Group shares are currently trading down by 0.0%, with a current price of $170.19 as of Wednesday morning. This brings the total value of Jamal's 428,807 shares to $41,036,829.

Delving into Affiliated Managers Group's Background

Affiliated Managers Group offers investment strategies to investors through its network of affiliates. The firm typically buys a majority interest in small to midsize boutique asset managers, receiving a fixed percentage of revenue from these firms in return. Affiliates operate independently, with AMG providing strategic, operational, and technology support, as well as global distribution. At the end of December 2023, AMG's affiliate network—which includes firms like AQR Capital Management, and Pantheon in alternative assets and other products (which accounted for 35% of AUM), Artemis, Genesis, Harding Loevner, and Tweedy Browne in global and emerging-market equities (28%) and Frontier, River Road, Parnassus, and Yacktman in U.S. equities (21%)—had $672.2 billion in managed assets.

Understanding the Numbers: Affiliated Managers Group's Finances

Negative Revenue Trend: Examining Affiliated Managers Group's financials over 3 months reveals challenges. As of 30 June, 2024, the company experienced a decline of approximately -2.38% in revenue growth, reflecting a decrease in top-line earnings. As compared to competitors, the company encountered difficulties, with a growth rate lower than the average among peers in the Financials sector.

Exploring Profitability:

• Gross Margin: Achieving a high gross margin of 56.97%, the company performs well in terms of cost management and profitability within its sector.

• Earnings per Share (EPS): Affiliated Managers Group's EPS is significantly higher than the industry average. The company demonstrates a robust bottom-line performance with a current EPS of 2.42.

Debt Management: Affiliated Managers Group's debt-to-equity ratio is below industry norms, indicating a sound financial structure with a ratio of 0.76.

Market Valuation:

• Price to Earnings (P/E) Ratio: With a lower-than-average P/E ratio of 9.91, the stock indicates an attractive valuation, potentially presenting a buying opportunity.

• Price to Sales (P/S) Ratio: With a lower-than-average P/S ratio of 3.36, the stock presents an attractive valuation, potentially signaling a buying opportunity for investors interested in 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 5.27, Affiliated Managers Group could be considered undervalued.

Market Capitalization Perspectives: The company's market capitalization falls below industry averages, signaling a relatively smaller size compared to peers. This positioning may be influenced by factors such as perceived growth potential or operational scale.

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

The Relevance of Insider Transactions

Insider transactions serve as a piece of the puzzle in investment decisions, rather than the entire picture.

From a legal standpoint, the term "insider" pertains to any officer, director, or beneficial owner holding more than ten percent of a company's equity securities as outlined in Section 12 of the Securities Exchange Act of 1934. This encompasses executives in the c-suite and significant hedge funds. These insiders are mandated to inform the public of their transactions through a Form 4 filing, to be submitted within two business days of the transaction.

A company insider's new purchase is a indicator of their positive anticipation for a rise in the stock.

While insider sells may not necessarily reflect a bearish view and can be motivated by various factors.

Transaction Codes To Focus On

For investors, a primary focus lies on transactions occurring in the open market, as indicated 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 Affiliated Managers Group's Insider Trades.

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