Disclosed on October 10, George J Christ, 10% Owner at Altair Engineering ALTR, executed a substantial insider sell as per the latest SEC filing.

What Happened: A Form 4 filing from the U.S. Securities and Exchange Commission on Thursday showed that Christ sold 49,952 shares of Altair Engineering. The total transaction amounted to $4,781,645.

Altair Engineering‘s shares are actively trading at $95.0, experiencing a down of 0.0% during Friday’s morning session.

Get to Know Altair Engineering Better

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.

Financial Insights: Altair Engineering

Revenue Growth: Over the 3 months period, Altair Engineering showcased positive performance, achieving a revenue growth rate of 5.41% as of 30 June, 2024. This reflects a substantial increase in the company’s top-line earnings. As compared to its peers, the revenue growth lags behind its industry peers. The company achieved a growth rate lower than the average among peers in Information Technology sector.

Evaluating Earnings Performance:

• Gross Margin: The company maintains a high gross margin of 79.49%, indicating strong cost management and profitability compared to its peers.

• Earnings per Share (EPS): Altair Engineering’s EPS is below the industry average, signaling challenges in bottom-line performance with a current EPS of -0.06.

Debt Management: Altair Engineering’s debt-to-equity ratio is below the industry average at 0.33, reflecting a lower dependency on debt financing and a more conservative financial approach.

Evaluating Valuation:

• Price to Earnings (P/E) Ratio: The current Price to Earnings ratio of 296.97 is higher than the industry average, indicating the stock is priced at a premium level according to the market sentiment.

• Price to Sales (P/S) Ratio: With a higher-than-average P/S ratio of 12.76, Altair Engineering’s stock is perceived as being overvalued in the market, particularly in relation to sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): Altair Engineering’s EV/EBITDA ratio, surpassing industry averages at 95.42, positions it with an above-average valuation in the market.

Market Capitalization Analysis: The company exhibits a lower market capitalization profile, positioning itself below industry averages. This suggests a smaller scale relative to peers.

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Why Insider Activity Matters in Finance

Insider transactions contribute to decision-making but should be supplemented by a comprehensive investment analysis.

In the realm of legality, an “insider” is defined as any officer, director, or beneficial owner holding more than ten percent of a company’s equity securities under Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and major hedge funds. These insiders are required to disclose their transactions through a Form 4 filing, to be submitted within two business days of the transaction.

Notably, when a company insider makes a new purchase, it is considered an indicator of their positive expectations for the stock.

Conversely, insider sells may not necessarily signal a bearish stance on the stock and can be motivated by various factors.

A Deep Dive into Insider 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 Altair Engineering’s Insider Trades.

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