In a recent transaction on July 2, 2024, an insider at Zurn Elkay Water Solutions Corp (NYSE:ZWS) sold a significant number of shares in the company. The total amount of common stock sold was valued at over $3.2 million, with the weighted average price per share being $29.07. The shares were sold in multiple transactions with prices ranging from $29.00 to $29.13.
The insider involved in this transaction is associated with Ice Mountain LLC, a ten percent owner of Zurn Elkay Water Solutions Corp. According to the details provided, Ice Mountain LLC directly executed the sale of 111,760 shares. After the sale, Ice Mountain LLC still retains a substantial amount of Zurn Elkay Water Solutions stock, totaling 23,454,164 shares. The ownership structure behind these transactions is complex, involving multiple entities. Cascade Bay LLC is the manager and sole Class A Member of Ice Mountain LLC, and Katz 2004 DYN Trust acts as the Special Assets Manager of Cascade Bay LLC. Both Cascade Bay LLC and Katz 2004 DYN Trust may be deemed to beneficially own the shares of common stock directly held by Ice Mountain LLC.
The sale was reported in a Form 4 document filed with the Securities and Exchange Commission, which provides transparency on the trading activities of company insiders. The reporting person has agreed to provide further details upon request regarding the number of shares sold at each specific price within the provided range.
The transaction was signed off by John Thickens, Senior Vice President of Northern Trust (NASDAQ:NTRS) Company, on behalf of Ice Mountain LLC, Cascade Bay LLC, and Katz 2004 DYN Trust. The signatures were dated July 3, 2024, one day after the reported sale took place.
Investors often monitor insider transactions as they can provide insights into an insider’s perspective on the company’s current valuation and future prospects. However, it is important to note that insider trading activities can be influenced by many factors and do not necessarily signal the company's operational performance or stock valuation changes.
In other recent news, Zurn Elkay Water Solutions Corporation declared a quarterly dividend of $0.08 per share, scheduled to be paid in cash on June 7, 2024, to shareholders on record by May 20, 2024. This is part of the company's regular dividend payments to its stockholders. In addition, Zurn Elkay reported strong performance in the first quarter, surpassing expectations with sales increasing by 400 basis points year-over-year, driven primarily by growth in non-residential markets. The company's adjusted EBITDA rose by 24%, with the margin expanding by 460 basis points.
Following these results, Zurn Elkay raised its full-year margin outlook and confirmed plans for share repurchases. The company also highlighted successful product launches, such as the Hydro-X Sensor Flush Valve. It expects to see double-digit growth rates in the drinking water and filtration segments. Despite a conservative guidance for the latter half of the year, Zurn Elkay remains optimistic about the full-year outlook, projecting low single-digit pro forma core sales growth for Q2 and an adjusted EBITDA margin between 24.5% and 25%, with approximately $250 million in free cash flow expected. These are recent developments that investors should take note of.
InvestingPro Insights
As investors digest the news of the recent insider sale at Zurn Elkay Water Solutions Corp (NYSE:ZWS), a deeper look at the company's financial health and market performance through InvestingPro might provide valuable context. Zurn Elkay has caught analysts' attention with a perfect Piotroski Score of 9, indicating a strong financial position. Furthermore, the company is expected to see net income growth this year, which could bode well for future stock performance.
From a valuation perspective, Zurn Elkay's P/E Ratio stands at 40.71, with an adjusted P/E Ratio for the last twelve months as of Q1 2024 at 36.17. This might suggest a high earnings multiple; however, the company's PEG Ratio during the same period is 0.39, indicating that the stock is trading at a low P/E ratio relative to near-term earnings growth. This could be an attractive point for investors looking for growth at a reasonable price. Additionally, Zurn Elkay's gross profit margin for the last twelve months as of Q1 2024 is a robust 43.69%, reflecting efficient operations and strong pricing power.
To gain further insights and access additional InvestingPro Tips, which highlight aspects such as the company's low price volatility, liquid assets position, and moderate level of debt, investors can explore the full suite of analytics tools. Currently, there are 9 additional InvestingPro Tips available for Zurn Elkay, which can be accessed with the use of coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription.
With a market capitalization of $5.03 billion and a dividend yield of 1.08%, Zurn Elkay presents a mixed picture that warrants a closer examination by investors. The company's solid return over the last five years and predictions of profitability this year are factors that might influence investment decisions.
Understanding the dynamics behind insider transactions such as the recent sale by Ice Mountain LLC can be complex. However, the InvestingPro platform provides a comprehensive analysis that can help investors make informed decisions by considering the broader financial and market indicators of Zurn Elkay Water Solutions Corp.
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