Benzinga - by Benzinga Insights, Benzinga Staff Writer.
A substantial insider sell was reported on June 13, by Revathi Advaithi, Chief Executive Officer at Flex (NASDAQ:FLEX), based on the recent SEC filing.
What Happened: According to a Form 4 filing with the U.S. Securities and Exchange Commission on Thursday, Advaithi sold 54,637 shares of Flex. The total transaction value is $1,759,125.
At Thursday morning, Flex shares are down by 1.09%, trading at $31.62.
Delving into Flex's Background Flex Ltd is a contract manufacturing company providing comprehensive electronics design, manufacturing, and product management services to electronics and technology companies. The company's operating segments include Flex Agility Solutions (FAS) and Flex Reliability Solutions (FRS). Flex Agility Solutions segment includes markets such as Communications, Enterprise and Cloud; Lifestyle; and Consumer Devices. Flex Reliability Solutions segment includes markets such as Automotive, Health Solutions, and Industrial.
Flex: Delving into Financials Negative Revenue Trend: Examining Flex's financials over 3 months reveals challenges. As of 31 March, 2024, the company experienced a decline of approximately -20.02% in revenue growth, reflecting a decrease in 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.
Exploring Profitability:
- Gross Margin: The company shows a low gross margin of -0.64%, indicating concerns regarding cost management and overall profitability relative to its industry counterparts.
- Earnings per Share (EPS): Flex's EPS lags behind the industry average, indicating concerns and potential challenges with a current EPS of 0.967896.
Navigating Market Valuation:
- Price to Earnings (P/E) Ratio: The P/E ratio of 16.15 is lower than the industry average, implying a discounted valuation for Flex's stock.
- Price to Sales (P/S) Ratio: The Price to Sales ratio is 0.53, which is lower than the industry average. This suggests a possible undervaluation based on sales performance.
- EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): With an EV/EBITDA ratio lower than industry averages at 10.02, Flex could be considered undervalued.
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Why Insider Activity Matters in Finance Insightful as they may be, insider transactions should be considered alongside a thorough examination of other investment criteria.
In the context of legal matters, the term "insider" refers to any officer, director, or beneficial owner holding more than ten percent of a company's equity securities, as outlined by Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and significant hedge funds. Such insiders are obligated to report their transactions through a Form 4 filing, which must be completed within two business days of the transaction.
Pointing towards optimism, a company insider's new purchase signals their positive anticipation for the stock to rise.
Despite insider sells not always signaling a bearish sentiment, they can be driven by various factors.
The Insider's Guide to Important Transaction Codes For investors, a primary focus lies on transactions occurring in the open market, as indicated in Table I of the Form 4 filing. A P in Box 3 denotes a purchase, while S signifies a sale. Transaction code C signals 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 Flex's Insider Trades.
This article was generated by Benzinga's automated content engine and reviewed by an editor.
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