Adient Insider Trades Send A Signal

James Conklin, EVP at Adient ADNT, reported an insider sell on December 5, according to a new SEC filing.

What Happened: Conklin's decision to sell 11,500 shares of Adient was revealed in a Form 4 filing with the U.S. Securities and Exchange Commission on Thursday. The total value of the sale is $232,875.

As of Friday morning, Adient shares are down by 0.36%, currently priced at $19.42.

All You Need to Know About Adient

Adient began trading Oct. 31, 2016, when Johnson Controls spun off its automotive experience segment. Adient is the leading seating supplier to the industry with about one third of the global market. Its share in China is now nearly 20%, down from about 45%, following the sale of its main joint venture there at the end of fiscal 2021. Unconsolidated revenue from joint ventures was about $3.8 billion in fiscal 2024 and consolidated China revenue was $1.4 billion. The company is headquartered in Ireland but has corporate offices in the Detroit area. Fiscal 2024 (Sept. 30 year-end) consolidated revenue, which excludes joint venture sales, was $14.7 billion.

Adient: Delving into Financials

Revenue Challenges: Adient's revenue growth over 3 months faced difficulties. As of 30 September, 2024, the company experienced a decline of approximately -4.48%. 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 Consumer Discretionary sector.

Profitability Metrics: Unlocking Value

• Gross Margin: The company shows a low gross margin of 6.88%, suggesting potential challenges in cost control and profitability compared to its peers.

• Earnings per Share (EPS): Adient's EPS lags behind the industry average, indicating concerns and potential challenges with a current EPS of 0.918605.

Debt Management: Adient's debt-to-equity ratio stands notably higher than the industry average, reaching 1.13. This indicates a heavier reliance on borrowed funds, raising concerns about financial leverage.

Assessing Valuation Metrics:

• Price to Earnings (P/E) Ratio: Adient's stock is currently priced at a premium level, as reflected in the higher-than-average P/E ratio of 97.45.

• Price to Sales (P/S) Ratio: The P/S ratio of 0.12 is lower than the industry average, implying a discounted valuation for Adient's stock in relation to sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): At 4.75, Adient's EV/EBITDA ratio reflects a below-par valuation compared to industry averages signalling undervaluation

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.

Unmasking the Significance of Insider Transactions

Emphasizing the importance of a comprehensive approach, considering insider transactions is valuable, but it's crucial to evaluate them in conjunction with other investment factors.

In the realm of legality, an "insider" is defined as any officer, director, or beneficial owner holding more than ten percent of a company's equity securities under Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and major hedge funds. These insiders are required to disclose their transactions through a Form 4 filing, to be submitted within two business days of the transaction.

Notably, when a company insider makes a new purchase, it is considered an indicator of their positive expectations for the stock.

Conversely, insider sells may not necessarily signal a bearish stance on the stock and can be motivated by various factors.

Important 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 Adient's Insider Trades.

Insider Buying Alert: Profit from C-Suite Moves

Benzinga Edge reveals every insider trade in real-time. Don't miss the next big stock move driven by insider confidence. Unlock this ultimate sentiment indicator now. Click here for access.

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