It was revealed in a recent SEC filing that Michael Doar, Board Member at Twin Disc TWIN made a noteworthy insider purchase on November 4,.

What Happened: Doar’s recent purchase of 8,120 shares of Twin Disc, disclosed in a Form 4 filing with the U.S. Securities and Exchange Commission on Monday, reflects confidence in the company’s potential. The total transaction value is $96,250.

The latest market snapshot at Tuesday morning reveals Twin Disc shares up by 0.43%, trading at $11.73.

About Twin Disc

Twin Disc Inc is a United States-based firm engaged in the manufacture and sale of marine and heavy-duty off-highway power transmission equipment. The company operates its business through two reportable segments: Manufacturing and Distribution. Its product portfolio includes marine transmissions, surface drives, propellers, and boat management systems as well as power-shift transmissions, hydraulic torque converters, power take-offs, industrial clutches, and control systems.

Financial Milestones: Twin Disc’s Journey

Positive Revenue Trend: Examining Twin Disc’s financials over 3 months reveals a positive narrative. The company achieved a noteworthy revenue growth rate of 0.59% as of 30 June, 2024, showcasing a substantial increase in 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 Industrials sector.

Profitability Metrics: Unlocking Value

• Gross Margin: The company sets a benchmark with a high gross margin of 29.72%, reflecting superior cost management and profitability compared to its peers.

• Earnings per Share (EPS): Twin Disc’s EPS lags behind the industry average, indicating concerns and potential challenges with a current EPS of 0.54.

Debt Management: With a below-average debt-to-equity ratio of 0.26, Twin Disc adopts a prudent financial strategy, indicating a balanced approach to debt management.

Analyzing Market Valuation:

• Price to Earnings (P/E) Ratio: A higher-than-average P/E ratio of 14.81 suggests caution, as the stock may be overvalued in the eyes of investors.

• Price to Sales (P/S) Ratio: The Price to Sales ratio is 0.55, 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): With an EV/EBITDA ratio lower than industry averages at 6.91, Twin Disc could be considered undervalued.

Market Capitalization Analysis: Falling below industry benchmarks, the company’s market capitalization reflects a reduced size compared to peers. This positioning may be influenced by factors such as growth expectations or operational capacity.

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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.

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.

Cracking Transaction Codes

When analyzing 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 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 Twin Disc’s Insider Trades.

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