Benzinga - by Benzinga Insights, Benzinga Staff Writer.
Revealing a significant insider sell on May 1, Sherry Bahrambeygui, Director at Pricesmart (NASDAQ:PSMT), as per the latest SEC filing.
What Happened: Bahrambeygui opted to sell 5,201 shares of Pricesmart, according to a Form 4 filing with the U.S. Securities and Exchange Commission on Wednesday. The transaction's total worth stands at $430,778.
Monitoring the market, Pricesmart's shares up by 0.96% at $81.36 during Wednesday's morning.
Get to Know Pricesmart Better Pricesmart Inc is principally engaged in operating U.S.-style membership shopping warehouse clubs that offer consumer goods at low prices. The company is headquartered in San Diego, California, United States, and operates stores in Latin America and the Caribbean, with Central America contributing over half of its net warehouse club sales. The company's revenue consists of net warehouse club sales from merchandise sales, membership income from annual membership fees, export sales, and other income, with net warehouse club sales accounting for the majority of the company's total revenue.
Understanding the Numbers: Pricesmart's Finances Positive Revenue Trend: Examining Pricesmart's financials over 3 months reveals a positive narrative. The company achieved a noteworthy revenue growth rate of 13.11% as of 29 February, 2024, showcasing a substantial increase in top-line earnings. As compared to its peers, the company achieved a growth rate higher than the average among peers in Consumer Staples sector.
Holistic Profitability Examination:
- Gross Margin: The company faces challenges with a low gross margin of 17.11%, suggesting potential difficulties in cost control and profitability compared to its peers.
- Earnings per Share (EPS): With an EPS below industry norms, Pricesmart exhibits below-average bottom-line performance with a current EPS of 1.31.
Valuation Metrics: A Closer Look
- Price to Earnings (P/E) Ratio: The current P/E ratio of 20.3 is below industry norms, indicating potential undervaluation and presenting an investment opportunity.
- Price to Sales (P/S) Ratio: With a lower-than-average P/S ratio of 0.53, the stock presents an attractive valuation, potentially signaling a buying opportunity for investors interested in sales performance.
- EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): Pricesmart's EV/EBITDA ratio at 9.01 suggests potential undervaluation, falling below industry averages.
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Unmasking the Significance of Insider Transactions While insider transactions should not be the sole basis for making investment decisions, they can play a significant role in an investor's decision-making process.
In legal terms, an "insider" refers to any officer, director, or beneficial owner of more than ten percent of a company's equity securities registered under Section 12 of the Securities Exchange Act of 1934. This can include executives in the c-suite and large hedge funds. These insiders are required to let the public know of their transactions via a Form 4 filing, which must be filed within two business days of the transaction.
When a company insider makes a new purchase, that is an indication that they expect the stock to rise.
Insider sells, on the other hand, can be made for a variety of reasons, and may not necessarily mean that the seller thinks the stock will go down.
A Deep Dive into Insider Transaction Codes Examining transactions, investors often concentrate on those unfolding in the open market, meticulously detailed in Table I of the Form 4 filing. A P in Box 3 denotes a purchase, while S signifies a sale. Transaction code C indicates 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 Pricesmart's Insider Trades.
This article was generated by Benzinga's automated content engine and reviewed by an editor.
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