Benzinga - by Benzinga Insights, Benzinga Staff Writer.
Mark Hipp, Director at Carter's (NYSE:CRI), reported an insider sell on March 22, according to a new SEC filing.
What Happened: According to a Form 4 filing with the U.S. Securities and Exchange Commission on Friday, Hipp sold 1,875 shares of Carter's. The total transaction value is $153,260.
Carter's shares are trading down 0.0% at $84.59 at the time of this writing on Friday morning.
Unveiling the Story Behind Carter's Carter's Inc makes apparel for babies and children under brand names including Carter's and OshKosh B'gosh. It sells its products through a multi-channel business model, which includes retail stores, eCommerce, and wholesale sales channels, as well as retail omnichannel capabilities in the United States and Canada, which enables it to reach a broad range of consumers around the world. The company operates in three segments; U.S. Retail, U.S. Wholesale, and International. The majority of Carter's sales are in the U.S. and through Carter's brand. The company predominantly sources products through contract manufacturers in Asia. It has multiple distribution centers in the U.S., in addition to distribution centers in Canada and Asia that serve international customers.
Carter's's Financial Performance Negative Revenue Trend: Examining Carter's's financials over 3 months reveals challenges. As of 31 December, 2023, the company experienced a decline of approximately -5.95% in revenue growth, reflecting a decrease in top-line earnings. When compared to others in the Consumer Discretionary sector, the company faces challenges, achieving a growth rate lower than the average among peers.
Exploring Profitability:
- Gross Margin: The company faces challenges with a low gross margin of 48.75%, suggesting potential difficulties in cost control and profitability compared to its peers.
- Earnings per Share (EPS): Carter's's EPS is notably higher than the industry average. The company achieved a positive bottom-line trend with a current EPS of 2.9.
Assessing Valuation Metrics:
- Price to Earnings (P/E) Ratio: The current P/E ratio of 13.56 is below industry norms, indicating potential undervaluation and presenting an investment opportunity.
- Price to Sales (P/S) Ratio: With a P/S ratio of 1.05 below industry standards, the stock shows potential undervaluation, making it an appealing investment option for those focusing on sales performance.
- EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): With a below-average EV/EBITDA ratio of 9.53, Carter's presents an opportunity for value investors. This lower valuation may attract investors seeking undervalued opportunities.
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Delving Into the Significance of Insider Transactions Emphasizing the importance of a comprehensive approach, considering insider transactions is valuable, but it's crucial to evaluate them in conjunction with other investment factors.
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.
Exploring Key Transaction Codes When dissecting transactions, the focal point for investors is often those occurring 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 Carter's's Insider Trades.
This article was generated by Benzinga's automated content engine and reviewed by an editor.
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