Entities affiliated with Blackstone Inc. (NYSE:BX) have recently sold a significant number of shares in Gates Industrial Corp plc (NYSE:NYSE:GTES), a global manufacturer of power transmission and fluid power products. The series of transactions, which took place on August 21, 2024, involved the sale of shares at a price of $16.58 each, amounting to a total of over $506 million.
The largest of these transactions included the sale of 13,748,723 ordinary shares and 13,294,543 ordinary shares by two separate entities. Another sale involved 2,804,217 shares, while smaller transactions included 646,199 and 45,521 shares respectively. Following these sales, the entities still retain millions of shares in Gates Industrial, indicating a continued investment in the company's future.
Ownership of the shares sold is complex and involves multiple layers of Blackstone's corporate structure, with indirect ownership through various holding companies and partnerships. These sales were executed as part of a secondary offering and related private sale, as noted in the footnotes of the filing.
Blackstone Inc. is a leading global investment business, providing investment management and financial advisory services. The transactions were reported in compliance with SEC regulations, which require insiders to disclose sales and purchases of company securities. The disclosures provide transparency to the market and allow investors to monitor the investment activities of senior executives and large shareholders.
Investors tracking ownership changes in Gates Industrial Corp will take note of these transactions, as they represent significant movements by a major stakeholder. Gates Industrial, listed on the New York Stock Exchange under the ticker symbol GTES, continues to be a key player in the industrial machinery and equipment sector.
In other recent news, Gates Industrial Corporation reported a slight decrease in its second-quarter revenues for 2024, primarily due to weaker demand in industrial end markets. Despite this, the company saw an increase in its adjusted EBITDA margin, largely attributed to gross margin expansion. Additionally, Gates Industrial announced a secondary offering of 20 million ordinary shares by selling stockholders affiliated with Blackstone Inc., with Citigroup Global Markets Inc. contracted to buy back $125 million worth of shares. RBC Capital has revised its outlook for Gates Industrial, raising the price target from $19.00 to $20.00, while maintaining a Sector Perform rating. This adjustment comes after the company's announcement of a smaller-than-expected guidance cut and a modest second-quarter operating performance that exceeded expectations by 4%. In parallel, Gates Industrial is accelerating its restructuring efforts, expected to yield cost savings in 2024 and 2025. These are some of the recent developments in the company's business operations.
InvestingPro Insights
As Gates Industrial Corp plc (NYSE:GTES) sees significant stock transactions by entities affiliated with Blackstone Inc., it's essential for investors to consider the company's financial health and market performance. According to InvestingPro data, Gates Industrial has a market capitalization of approximately $4.7 billion. The company's P/E ratio stands at 21.34, reflecting investor expectations of future earnings. Despite a slight decline in revenue over the last twelve months as of Q2 2024, with a decrease of 3.19%, Gates Industrial boasts a robust gross profit margin of 39.62%. This margin indicates the company's ability to retain a significant portion of revenue after accounting for the cost of goods sold.
An InvestingPro Tip highlights that Gates Industrial has a perfect Piotroski Score of 9, suggesting strong financial health and signaling to investors that the company is operating efficiently with solid fundamentals. Additionally, the company is trading at a high P/E ratio relative to near-term earnings growth, indicating that the market may be pricing in optimistic future growth or other factors that could justify the current valuation.
For investors interested in a deeper analysis, there are 6 additional InvestingPro Tips available on Gates Industrial, including insights on earnings revisions and profitability forecasts. These tips can be accessed through the InvestingPro platform at https://www.investing.com/pro/GTES, providing a more comprehensive understanding of the company's financial outlook and investment potential.
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