TIMOTHY HORNE, 10% Owner at Watts Water Technologies WTS, disclosed an insider sell on November 6, according to a recent SEC filing.

What Happened: HORNE’s decision to sell 5,000 shares of Watts Water Technologies was revealed in a Form 4 filing with the U.S. Securities and Exchange Commission on Wednesday. The total value of the sale is $1,072,600.

During Thursday’s morning session, Watts Water Technologies shares down by 0.0%, currently priced at $212.17.

About Watts Water Technologies

Watts Water Technologies Inc is a U.S.-based company that provides safety, energy efficiency, and water conservation products. Its product portfolio includes residential and commercial flow control products, which are sold for plumbing and hot water applications; HVAC and gas products, including commercial boilers, water heaters, heating solutions, and heating systems; drainage and water reuse products, including drainage products and engineered rainwater-harvesting solutions; and water quality products, including point-of-use and point-of-entry water filtration, conditioning, and scale prevention systems. The company generates the majority of its revenue from markets in the Americas and in Europe, the Middle East, and Africa.

Watts Water Technologies’s Economic Impact: An Analysis

Revenue Growth: Watts Water Technologies displayed positive results in 3 months. As of 30 September, 2024, the company achieved a solid revenue growth rate of approximately 7.79%. This indicates a notable increase in the company’s top-line earnings. As compared to its peers, the company achieved a growth rate higher than the average among peers in Industrials sector.

Evaluating Earnings Performance:

• Gross Margin: Achieving a high gross margin of 47.3%, the company performs well in terms of cost management and profitability within its sector.

• Earnings per Share (EPS): Watts Water Technologies’s EPS is a standout, portraying a positive bottom-line trend that exceeds the industry average with a current EPS of 2.07.

Debt Management: Watts Water Technologies’s debt-to-equity ratio is below industry norms, indicating a sound financial structure with a ratio of 0.13.

Valuation Metrics:

• Price to Earnings (P/E) Ratio: With a lower-than-average P/E ratio of 25.44, the stock indicates an attractive valuation, potentially presenting a buying opportunity.

• Price to Sales (P/S) Ratio: With a P/S ratio of 3.15 below industry standards, the stock shows potential undervaluation, making it an appealing investment option for those focusing on sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): Indicated by a lower-than-industry-average EV/EBITDA ratio of 15.75, the company suggests a potential undervaluation, which might be advantageous for value-focused investors.

Market Capitalization Analysis: Reflecting a smaller scale, the company’s market capitalization is positioned below industry averages. This could be attributed to factors such as growth expectations or operational capacity.

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Unmasking the Significance of Insider Transactions

It’s important to note that insider transactions alone should not dictate investment decisions, but they can provide valuable insights.

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

The initiation of a new purchase by a company insider serves as a strong indication that they expect the stock to rise.

However, insider sells may not always signal a bearish view and can be influenced by various factors.

Exploring Key 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 Watts Water Technologies’s Insider Trades.

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