Revealing a significant insider sell on October 23, Robert G Brown, 10% Owner at SPAR Group SGRP, as per the latest SEC filing.

What Happened: Brown’s decision to sell 43,834 shares of SPAR Group was revealed in a Form 4 filing with the U.S. Securities and Exchange Commission on Wednesday. The total value of the sale is $106,078.

At Thursday morning, SPAR Group shares are up by 0.83%, trading at $2.43.

Discovering SPAR Group: A Closer Look

SPAR Group Inc is a supplier of merchandising and other marketing services. It also provides range of services to retailers, consumer goods manufacturers and distributors around the globe. The company divides its operations into three reportable regional segments: Americas, which is comprised of United States, Canada, Brazil and Mexico; Asia-Pacific (APAC), which is comprised of Japan, China, and India; and Europe, Middle East and Africa (EMEA), which is comprised of South Africa. It generates maximum revenue from Americas.

SPAR Group: Delving into Financials

Revenue Challenges: SPAR Group’s revenue growth over 3 months faced difficulties. As of 30 June, 2024, the company experienced a decline of approximately -13.11%. This indicates a decrease in top-line earnings. When compared to others in the Communication Services sector, the company faces challenges, achieving a growth rate lower than the average among peers.

Insights into Profitability:

• Gross Margin: The company faces challenges with a low gross margin of 19.19%, suggesting potential difficulties in cost control and profitability compared to its peers.

• Earnings per Share (EPS): SPAR Group’s EPS is a standout, portraying a positive bottom-line trend that exceeds the industry average with a current EPS of 0.15.

Debt Management: The company faces challenges in debt management with a debt-to-equity ratio higher than the industry average. With a ratio of 0.73, caution is advised due to increased financial risk.

Valuation Metrics: A Closer Look

• Price to Earnings (P/E) Ratio: The P/E ratio of 4.55 is lower than the industry average, implying a discounted valuation for SPAR Group’s stock.

• Price to Sales (P/S) Ratio: The P/S ratio of 0.23 is lower than the industry average, implying a discounted valuation for SPAR Group’s stock in relation to sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): With an EV/EBITDA ratio lower than industry averages at 2.51, SPAR Group could be considered undervalued.

Market Capitalization Analysis: Below industry benchmarks, the company’s market capitalization reflects a smaller scale relative to peers. This could be attributed to factors such as growth expectations or operational capacity.

Now trade stocks online commission free with Charles Schwab, a trusted and complete investment firm.

Why Insider Transactions Are Key in Investment Decisions

Insider transactions shouldn’t be used primarily to make an investing decision, however, they can be an important factor for an investor to consider.

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.

Navigating the World of 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 SPAR Group’s Insider Trades.

Insider Buying Alert: Profit from C-Suite Moves

Benzinga Edge reveals every insider trade in real-time. Don’t miss the next big stock move driven by insider confidence. Unlock this ultimate sentiment indicator now. Click here for access.

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