RCI Hospitality Hldgs Chief Financial Officer Trades $81K In Company Stock

It was reported on August 22, that Bradley Lim Chhay, Chief Financial Officer at RCI Hospitality Hldgs RICK executed a significant insider sell, according to an SEC filing.

What Happened: According to a Form 4 filing with the U.S. Securities and Exchange Commission on Thursday, Chhay sold 1,870 shares of RCI Hospitality Hldgs. The total transaction value is $81,359.

The latest market snapshot at Friday morning reveals RCI Hospitality Hldgs shares down by 0.0%, trading at $43.88.

Get to Know RCI Hospitality Hldgs Better

RCI Hospitality Holdings Inc through its subsidiaries owns and operates establishments that offer live adult entertainment, restaurant, and or bar operations. It also owns and operates a communication company serving the adult nightclubs industry. The company's operating business segments are Nightclubs, Bombshells, and Others. It operates nightclubs through the following brand's Rick's Cabaret, Vivid Cabaret, Tootsie's Cabaret, Club Onyx, and Jaguars Club. In the Bombshells segment, the company is building a chain of Restaurants and Sports Bars in Dallas, Austin, and Houston, Texas. It derives majority revenue from the Nightclubs segment that engages in the sale of alcoholic beverages, food, and merchandise items; service in the form of cover charge, dance fees, and room rentals.

Understanding the Numbers: RCI Hospitality Hldgs's Finances

Decline in Revenue: Over the 3 months period, RCI Hospitality Hldgs faced challenges, resulting in a decline of approximately -1.14% in revenue growth as of 30 June, 2024. This signifies a reduction in the company's top-line earnings. As compared to its peers, the revenue growth lags behind its industry peers. The company achieved a growth rate lower than the average among peers in Consumer Discretionary sector.

Profitability Metrics: Unlocking Value

• Gross Margin: The company faces challenges with a low gross margin of 58.65%, suggesting potential difficulties in cost control and profitability compared to its peers.

• Earnings per Share (EPS): RCI Hospitality Hldgs's EPS is below the industry average, signaling challenges in bottom-line performance with a current EPS of -0.56.

Debt Management: With a below-average debt-to-equity ratio of 1.04, RCI Hospitality Hldgs adopts a prudent financial strategy, indicating a balanced approach to debt management.

Understanding Financial Valuation:

• Price to Earnings (P/E) Ratio: RCI Hospitality Hldgs's stock is currently priced at a premium level, as reflected in the higher-than-average P/E ratio of 84.27.

• Price to Sales (P/S) Ratio: The Price to Sales ratio is 1.38, which is lower than the industry average. This suggests a possible undervaluation based on sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): Boasting an EV/EBITDA ratio of 17.29, RCI Hospitality Hldgs demonstrates a robust market valuation, outperforming industry benchmarks.

Market Capitalization Analysis: Positioned below industry benchmarks, the company's market capitalization faces constraints in size. This could be influenced by factors such as growth expectations or operational capacity.

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Understanding the Significance of Insider Transactions

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

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.

A Closer Look at Important Transaction Codes

Examining transactions, investors often concentrate on those unfolding 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 RCI Hospitality Hldgs's Insider Trades.

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