Benzinga - by Benzinga Insights, Benzinga Staff Writer.
A substantial insider move unfolded on May 21, as Reller, Board Member at SPS Commerce (NASDAQ:SPSC), reported the acquisition of stock options for 1,136 shares in an SEC filing.
What Happened: Reller, Board Member at SPS Commerce, engaged in a derivative transaction according to a Form 4 filing on Tuesday with the U.S. Securities and Exchange Commission. This involved the acquisition of stock options for 1,136 shares of SPSC, providing the right to purchase the company's stock at an exercise price of $80.31 per share.
As of Tuesday morning, SPS Commerce shares are down by 0.0%, with a current price of $199.42. This implies that Reller's 1,136 shares have a value of $135,308.
Get to Know SPS Commerce Better SPS Commerce Inc is a provider of cloud-based supply chain management services for retailers, grocers, distributors, suppliers, and logistics firms to increase supply chain performance, optimize inventory levels and sell-through, reduce operational costs, improve order visibility, and satisfy consumer demands for a seamless omnichannel experience. Its solutions are delivered through the SPS Commerce platform and provide integrations and retail performance analytics to its customers. Its products are; Fulfillment, Analytics, and Other products like Assortment and Community also it provides one-time services such as professional services and testing and certification. The group derives revenue from recurring monthly fees and set-up fees.
Breaking Down SPS Commerce's Financial Performance Revenue Growth: SPS Commerce's revenue growth over a period of 3 months has been noteworthy. As of 31 March, 2024, the company achieved a revenue growth rate of approximately 18.84%. This indicates a substantial increase in the company's top-line earnings. When compared to others in the Information Technology sector, the company faces challenges, achieving a growth rate lower than the average among peers.
Navigating Financial Profits:
- Gross Margin: With a high gross margin of 65.58%, the company demonstrates effective cost control and strong profitability relative to its peers.
- Earnings per Share (EPS): SPS Commerce's EPS reflects a decline, falling below the industry average with a current EPS of 0.49.
Analyzing Market Valuation:
- Price to Earnings (P/E) Ratio: SPS Commerce's P/E ratio of 108.97 is below the industry average, suggesting the stock may be undervalued.
- Price to Sales (P/S) Ratio: The current P/S ratio of 13.38 is above industry norms, reflecting an elevated valuation for SPS Commerce's stock and potential overvaluation based on sales performance.
- EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): Boasting an EV/EBITDA ratio of 63.9, SPS Commerce demonstrates a robust market valuation, outperforming industry benchmarks.
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Why Insider Activity Matters in Finance Insider transactions shouldn't be used primarily to make an investing decision, however an insider transaction can be an important factor in the investing decision.
Within the legal framework, an "insider" is defined as any officer, director, or beneficial owner holding more than ten percent of a company's equity securities as per Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and major hedge funds. These insiders are mandated to disclose their transactions through a Form 4 filing, to be submitted within two business days of the transaction.
The initiation of a new purchase by a company insider serves as a strong indication that they expect the stock to rise.
However, insider sells may not always signal a bearish view and can be influenced by various factors.
Important Transaction Codes Investors prefer focusing on transactions that take place in the open market, indicated in Table I of the Form 4 filing. A P in Box 3 indicates a purchase, while S indicates a sale. Transaction code C indicates the conversion of an option, and transaction code A indicates grant, award or other acquisition of securities from the company.
Check Out The Full List Of SPS Commerce's Insider Trades.
This article was generated by Benzinga's automated content engine and reviewed by an editor.
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