Joseph Del Preto, the Chief Financial Officer and Treasurer of Sprout Social, Inc. (NASDAQ:SPT), has recently sold a significant portion of his company stock, according to a new SEC filing. Over two consecutive days, Del Preto sold a total of 4,020 shares of Class A Common Stock, with transactions totaling over $129,000.
On June 3, 2024, Del Preto sold 1,500 shares at a weighted average price of $32.394, totaling approximately $48,591. The following day, he sold an additional 2,520 shares at a slightly lower weighted average price of $32.136, amounting to $80,982. The prices for these sales ranged from $32.12 to $32.80 per share.
According to the footnotes provided in the SEC filing, the first transaction was executed under a pre-arranged 10b5-1 trading plan adopted on August 16, 2023. The second sale was made in accordance with an irrevocable election from November 21, 2022, to cover tax obligations related to the settlement of restricted stock units (RSUs).
Following these sales, Del Preto's reported holdings in Sprout Social include vested and unvested RSUs that are scheduled to vest over the coming years. The total number of shares owned by Del Preto after these transactions is 169,644, inclusive of the RSUs.
The SEC filing was signed on behalf of Del Preto by Heidi Jonas, Attorney-in-fact, on June 5, 2024.
In other recent news, Sprout Social, a social media management tools provider, has addressed rumors about going private, assuring there is currently no active process to sell the company or pursue a private transaction. Goldman Sachs (NYSE:GS) has downgraded Sprout Social's stock from Buy to Neutral, adjusting the price target to $44 from the previous $80, citing potential near-term disruption to organic growth as the company shifts its focus to higher-end markets.
In the latest earnings report, Sprout Social announced a Q1 revenue of $96.8 million, a 29% increase year-over-year, and a non-GAAP operating income of $6.0 million. Despite missing revenue targets, the company expressed confidence in its revised strategy aimed at larger customers and improved sales productivity. Goldman Sachs' downgrade and the revised revenue outlook are key recent developments for the company.
Sprout Social also announced the promotion of Ryan Barretto to CEO and a shift away from reporting certain metrics like ARR, customer count, and logo numbers. The company is realigning its go-to-market strategy to focus on larger and more sophisticated customers, aiming to overcome challenges and achieve significant growth in the latter half of 2024. These are the latest developments for Sprout Social.
InvestingPro Insights
As Sprout Social's CFO, Joseph Del Preto, adjusts his holdings in the company, investors might be curious about the broader financial picture of Sprout Social, Inc. (NASDAQ:SPT). The company, with a market capitalization of approximately $1.92 billion, has demonstrated an impressive gross profit margin of 76.97% over the last twelve months as of Q1 2024, according to data from InvestingPro. This indicates a strong ability to control costs and suggests a solid business model, which can be a reassuring sign for investors amidst the CFO's stock transactions.
Despite not being profitable over the last twelve months, Sprout Social has shown a robust revenue growth of 30.78% during the same period. This growth momentum is also reflected in the company's quarterly revenue increase of 28.68% in Q1 2024. These metrics highlight the company's expanding business and potential for future profitability, which aligns with analysts' predictions that the company will turn a profit this year. Such insights are particularly relevant for investors considering the recent insider selling activity.
InvestingPro Tips reveal that while the stock has experienced significant price volatility and has taken a considerable hit over the past six months, with a -39.96% return, it has also seen a strong rebound over the last month, with a return of 17.7%. Investors may find these metrics useful for understanding the recent performance dynamics of Sprout Social's stock and for making informed decisions about their investment strategies.
For those interested in a deeper dive into Sprout Social's financial health and stock performance, there are additional InvestingPro Tips available at https://www.investing.com/pro/SPT. To enhance your investment analysis, use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription. There are 8 more InvestingPro Tips available that can provide further insights into Sprout Social's financial standing and market potential.
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