Joseph W McClanathan, Director at Brunswick BC, executed a substantial insider sell on October 28, according to an SEC filing.

What Happened: McClanathan’s decision to sell 4,745 shares of Brunswick was revealed in a Form 4 filing with the U.S. Securities and Exchange Commission on Monday. The total value of the sale is $380,264.

The latest update on Tuesday morning shows Brunswick shares down by 1.39%, trading at $80.91.

Discovering Brunswick: A Closer Look

Brunswick is a leading manufacturer in the marine recreation industry. The firm has more than 60 brands delivering products across propulsion (outboard, sterndrive, and inboard engines, propulsion-related controls, rigging, and propellers), parts, accessories, and technology, and boats (including well-known brands like Boston Whaler and Sea Ray). It also owns numerous Freedom Boat Club (shared ownership) locations as well as Boateka, which facilitates transactions in the used boat market. Brunswick’s focus surrounds building the innovative marine and recreational experiences, technologies, and connections supported by quality and innovation.

Key Indicators: Brunswick’s Financial Health

Revenue Growth: Brunswick’s revenue growth over a period of 3 months has faced challenges. As of 30 September, 2024, the company experienced a revenue decline of approximately -11.82%. This indicates a decrease in the company’s 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 issues a cost efficiency warning with a low gross margin of 26.15%, indicating potential difficulties in maintaining profitability compared to its peers.

• Earnings per Share (EPS): Brunswick’s EPS is notably higher than the industry average. The company achieved a positive bottom-line trend with a current EPS of 0.67.

Debt Management: The company faces challenges in debt management with a debt-to-equity ratio higher than the industry average. With a ratio of 1.26, caution is advised due to increased financial risk.

Financial Valuation Breakdown:

• Price to Earnings (P/E) Ratio: The Price to Earnings ratio of 19.13 is lower than the industry average, indicating potential undervaluation for the stock.

• Price to Sales (P/S) Ratio: The Price to Sales ratio is 1.03, 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 9.9 is below the industry average, indicating that it may be relatively undervalued compared to peers.

Market Capitalization Analysis: The company’s market capitalization surpasses industry averages, showcasing a dominant size relative to peers and suggesting a strong market position.

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Why Pay Attention to Insider Transactions

While insider transactions provide valuable information, they should be part of a broader analysis in making investment decisions.

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.

Cracking 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 Brunswick’s Insider Trades.

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