Lance D. Bultena, Board Member at Daktronics DAKT, reported an insider buy on September 11, according to a new SEC filing.

What Happened: Bultena made a significant move by purchasing 7,160 shares of Daktronics as reported in a Form 4 filing with the U.S. Securities and Exchange Commission. The transaction’s total worth stands at $84,989.

Daktronics shares are trading down 0.0% at $12.19 at the time of this writing on Thursday morning.

Get to Know Daktronics Better

Daktronics Inc designs and manufactures electronic scoreboards, programmable display systems, and large-screen video displays for sporting, commercial, and transportation applications. It is engaged in a full range of activities: marketing and sales, engineering and product design and development, manufacturing, technical contracting, professional services, and customer service and support. The company offers a complete line of products, from small scoreboards and electronic displays to large multimillion-dollar video display systems as well as related control, timing, and sound systems. The company has five reportable segments: Commercial, Live Events, High School Park and Recreation, Transportation, and International. The company makes the majority of its revenue from Live events.

Daktronics’s Financial Performance

Revenue Growth: Daktronics’s revenue growth over a period of 3 months has faced challenges. As of 31 July, 2024, the company experienced a revenue decline of approximately -2.77%. This indicates a decrease in the company’s top-line earnings. When compared to others in the Information Technology sector, the company faces challenges, achieving a growth rate lower than the average among peers.

Holistic Profitability Examination:

• Gross Margin: The company shows a low gross margin of 26.4%, suggesting potential challenges in cost control and profitability compared to its peers.

• Earnings per Share (EPS): With an EPS below industry norms, Daktronics exhibits below-average bottom-line performance with a current EPS of -0.11.

Debt Management: With a below-average debt-to-equity ratio of 0.32, Daktronics adopts a prudent financial strategy, indicating a balanced approach to debt management.

Evaluating Valuation:

• Price to Earnings (P/E) Ratio: Daktronics’s stock is currently priced at a premium level, as reflected in the higher-than-average P/E ratio of 58.05.

• Price to Sales (P/S) Ratio: The Price to Sales ratio is 0.7, which is lower than the industry average. This suggests a possible undervaluation based on sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): The company’s EV/EBITDA ratio 6.15 is below the industry average, indicating that it may be relatively undervalued compared to peers.

Market Capitalization Analysis: Positioned below industry benchmarks, the company’s market capitalization faces constraints in size. This could be influenced by factors such as growth expectations or operational capacity.

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The Importance of Insider Transactions

Insider transactions are not the sole determinant of investment choices, but they are a factor worth considering.

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.

Important Transaction Codes

For investors, a primary focus lies on transactions occurring in the open market, as indicated in Table I of the Form 4 filing. A P in Box 3 denotes 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 Daktronics’s Insider Trades.

This article was generated by Benzinga’s automated content engine and reviewed by an editor.