Benzinga - by Benzinga Insights, Benzinga Staff Writer.
Paul Uhlman, Vice President at Federated Hermes (NYSE:FHI), executed a substantial insider sell on February 8, according to an SEC filing.
What Happened: According to a Form 4 filing with the U.S. Securities and Exchange Commission on Thursday, Uhlman sold 90,745 shares of Federated Hermes. The total transaction value is $3,200,013.
At Friday morning, Federated Hermes shares are down by 0.0%, trading at $34.98.
About Federated Hermes Federated provides asset management services for institutional and individual investors. The company had $715.2 billion in managed assets at the end of September 2023, composed of equity (11%), multi-asset (less than 1%), fixed-income (13%), alternative (3%), and money market (73%) funds. That said, the firm's cash-management operations are expected to generate around 46% of Federated's revenue this year, compared with 31%, 12%, and 11%, respectively, for the firm's equity, fixed-income, and alternatives/multi-asset operations. From a channel perspective, the company's products are distributed via trust banks, wealth managers and retail broker/dealers (63% of AUM), institutional investors (27%), and international clients (10%).
Understanding the Numbers: Federated Hermes's Finances Decline in Revenue: Over the 3 months period, Federated Hermes faced challenges, resulting in a decline of approximately -2.77% in revenue growth as of 31 December, 2023. This signifies a reduction 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 Financials sector.
Evaluating Earnings Performance:
- Gross Margin: With a high gross margin of 67.43%, the company demonstrates effective cost control and strong profitability relative to its peers.
- Earnings per Share (EPS): Federated Hermes's EPS is below the industry average, signaling challenges in bottom-line performance with a current EPS of 0.96.
Market Valuation:
- Price to Earnings (P/E) Ratio: The P/E ratio of 10.29 is lower than the industry average, implying a discounted valuation for Federated Hermes's stock.
- Price to Sales (P/S) Ratio: With a P/S ratio of 1.82 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): The company's EV/EBITDA ratio of 6.62 trails industry averages, indicating a potential disparity in market valuation that could be advantageous for investors.
Now trade stocks online commission free with Charles Schwab, a trusted and complete investment firm.
The Importance of Insider Transactions Insider transactions shouldn't be used primarily to make an investing decision, however, they can be an important factor for an investor to consider.
When discussing 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 stipulated in Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and significant hedge funds. Such insiders are required to report their transactions through a Form 4 filing, which must be completed within two business days of the transaction.
A new purchase by a company insider is a indication that they anticipate the stock will rise.
On the other hand, insider sells may not necessarily indicate a bearish view and can be motivated by various factors.
A Closer Look at Important Transaction Codes When it comes to transactions, investors tend to focus on those in the open market, detailed in Table I of the Form 4 filing. A P in Box 3 denotes a purchase, while S indicates 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 Federated Hermes's Insider Trades.
This article was generated by Benzinga's automated content engine and reviewed by an editor.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.