Insider Move: Jeffrey Niew Exercises Options, Realizing $755K At Knowles

Jeffrey Niew, President & CEO at Knowles KN, reported a large exercise of company stock options on November 7, according to a new SEC filing.

What Happened: Niew, President & CEO at Knowles, made a strategic move by exercising stock options for 157,699 shares of KN as detailed in a Form 4 filing on Thursday with the U.S. Securities and Exchange Commission. The transaction value amounted to $755,378.

Knowles shares are trading down 0.47% at $19.08 at the time of this writing on Friday morning. Since the current price is $19.08, this makes Niew's 157,699 shares worth $755,378.

Discovering Knowles: A Closer Look

Knowles Corp is engaged in the manufacturing of micro-acoustic microphones and balanced armature speakers, audio solutions, high-performance capacitors, and radio frequency filtering products. It operates in three segments; the Precision Devices segment specializes in the design and delivery of high-performance capacitor products and RF solutions, Medtech & Specialty Audio segment designs and manufactures microphones and balanced armature speakers used in applications and the Consumer MEMS Microphones segment designs and manufactures micro-electro-mechanical systems microphones and audio solutions used in applications. The majority of its revenue comes from the Consumer MEMS Microphones segment.

Knowles: Delving into Financials

Revenue Growth: Knowles's revenue growth over a period of 3 months has been noteworthy. As of 30 September, 2024, the company achieved a revenue growth rate of approximately 31.82%. This indicates 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 Information Technology sector.

Profitability Metrics: Unlocking Value

• Gross Margin: With a high gross margin of 44.14%, the company demonstrates effective cost control and strong profitability relative to its peers.

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

Debt Management: Knowles's debt-to-equity ratio is below the industry average at 0.3, reflecting a lower dependency on debt financing and a more conservative financial approach.

Valuation Metrics: A Closer Look

• Price to Earnings (P/E) Ratio: The current P/E ratio of 37.59 is below industry norms, indicating potential undervaluation and presenting an investment opportunity.

• Price to Sales (P/S) Ratio: The Price to Sales ratio is 2.16, 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): Indicated by a lower-than-industry-average EV/EBITDA ratio of 16.91, the company suggests a potential undervaluation, which might be advantageous for value-focused investors.

Market Capitalization Analysis: Falling below industry benchmarks, the company's market capitalization reflects a reduced size compared to peers. This positioning may be influenced by factors such as growth expectations or operational capacity.

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Why Pay Attention to Insider Transactions

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

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.

Understanding Crucial 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 Knowles's Insider Trades.

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