Benzinga - by Benzinga Insights, Benzinga Staff Writer.
Stephen Evans, Director at Alarm.com Holdings (NASDAQ:ALRM), reported an insider sell on February 28, according to a new SEC filing.
What Happened: A Form 4 filing from the U.S. Securities and Exchange Commission on Wednesday showed that Evans sold 1,000 shares of Alarm.com Holdings. The total transaction amounted to $74,120.
In the Wednesday's morning session, Alarm.com Holdings's shares are currently trading at $74.75, experiencing a down of 0.84%.
Get to Know Alarm.com Holdings Better Alarm.com Holdings Inc has two reportable segments: Alarm.com & Other. The Alarm.com segment represents the cloud-based Software platforms for intelligently connected property & related solutions. The other segment is focused on researching, developing & offering residential & commercial automation solutions & energy management products & services in adjacent markets. The majority of revenue is from the Alarm.com segment. The platform allows home & business owners to secure their properties and automate & control an array of connected devices. SaaS & license fees from service providers, who resell these services & pay Alarm.com a monthly subscription, are the sources of revenue for the firm. The majority of revenue is generated in the United States & Canada.
A Deep Dive into Alarm.com Holdings's Financials Revenue Growth: Alarm.com Holdings displayed positive results in 3 months. As of 31 December, 2023, the company achieved a solid revenue growth rate of approximately 8.7%. This indicates a notable increase in the company's top-line earnings. In comparison to its industry peers, the company trails behind with a growth rate lower than the average among peers in the Information Technology sector.
Key Insights into Profitability Metrics:
- Gross Margin: With a low gross margin of 64.1%, the company exhibits below-average profitability, signaling potential struggles in cost efficiency compared to its industry peers.
- Earnings per Share (EPS): Alarm.com Holdings's EPS outshines the industry average, indicating a strong bottom-line trend with a current EPS of 0.63.
Valuation Overview:
- Price to Earnings (P/E) Ratio: Alarm.com Holdings's P/E ratio of 49.25 is below the industry average, suggesting the stock may be undervalued.
- Price to Sales (P/S) Ratio: With a relatively high Price to Sales ratio of 4.67 as compared to the industry average, the stock might be considered overvalued based on sales performance.
- EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): At 24.71, Alarm.com Holdings's EV/EBITDA ratio reflects a below-par valuation compared to industry averages signalling undervaluation
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Navigating the Impact of Insider Transactions on Investments Insider transactions are not the sole determinant of investment choices, but they are a factor worth considering.
Considering the legal perspective, an "insider" is defined as any officer, director, or beneficial owner holding more than ten percent of a company's equity securities, according to 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.
Pointing towards optimism, a company insider's new purchase signals their positive anticipation for the stock to rise.
Nevertheless, insider sells may not necessarily indicate a bearish view and can be influenced by various factors.
Exploring Key Transaction Codes Delving into transactions, investors typically prioritize those unfolding in the open market, as precisely outlined in Table I of the Form 4 filing. A P in Box 3 indicates 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 Alarm.com Holdings's Insider Trades.
This article was generated by Benzinga's automated content engine and reviewed by an editor.
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