Benzinga - by Benzinga Insights, Benzinga Staff Writer.
Revealing a significant insider sell on May 20, George J Christ, 10% Owner at Altair Engineering (NASDAQ:ALTR), as per the latest SEC filing.
What Happened: Christ's decision to sell 50,000 shares of Altair Engineering was revealed in a Form 4 filing with the U.S. Securities and Exchange Commission on Monday. The total value of the sale is $4,517,985.
Tracking the Monday's morning session, Altair Engineering shares are trading at $91.52, showing a up of 1.13%.
Discovering Altair Engineering: A Closer Look Altair Engineering Inc is a provider of enterprise-class engineering software enabling origination of the entire product lifecycle from concept design to in-service operation. The integrated suite of software provided by the company optimizes design performance across multiple disciplines encompassing structures, motion, fluids, thermal management, system modeling, and embedded systems. It operates through two segments: Software which includes the portfolio of software products such as solvers and optimization technology products, modeling and visualization tools, industrial and concept design tools, and others; and Client Engineering Services which provides client engineering services to support customers. Majority of its revenue comes from the software segment.
Unraveling the Financial Story of Altair Engineering Revenue Growth: Altair Engineering's remarkable performance in 3 months is evident. As of 31 March, 2024, the company achieved an impressive revenue growth rate of 4.14%. This signifies a substantial increase in the company's top-line earnings. As compared to competitors, the company encountered difficulties, with a growth rate lower than the average among peers in the Information Technology sector.
Interpreting Earnings Metrics:
- Gross Margin: With a high gross margin of 82.13%, the company demonstrates effective cost control and strong profitability relative to its peers.
- Earnings per Share (EPS): Altair Engineering's EPS is below the industry average. The company faced challenges with a current EPS of 0.2. This suggests a potential decline in earnings.
Understanding Financial Valuation:
- Price to Earnings (P/E) Ratio: With a higher-than-average P/E ratio of 822.73, Altair Engineering's stock is perceived as being overvalued in the market.
- Price to Sales (P/S) Ratio: A higher-than-average P/S ratio of 12.12 suggests overvaluation in the eyes of investors, considering sales performance.
- EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): A high EV/EBITDA ratio of 98.83 positions the company as being more valued compared to industry benchmarks.
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Why Insider Transactions Are Important 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.
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.
Breaking Down the Significance of Transaction Codes Surveying the realm of stock transactions, investors often give prominence to those unfolding in the open market, systematically detailed in Table I of the Form 4 filing. A P in Box 3 indicates a purchase, while S signifies a sale. Transaction code C denotes 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 Altair Engineering's Insider Trades.
This article was generated by Benzinga's automated content engine and reviewed by an editor.
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