Monica Barry, Chief Hr Officer at Watts Water Technologies WTS, reported an insider sell on November 7, according to a new SEC filing.

What Happened: Barry’s decision to sell 1,559 shares of Watts Water Technologies was revealed in a Form 4 filing with the U.S. Securities and Exchange Commission on Thursday. The total value of the sale is $331,318.

The latest update on Friday morning shows Watts Water Technologies shares up by 0.33%, trading at $207.93.

Discovering Watts Water Technologies: A Closer Look

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: Financial Performance Dissected

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. When compared to others in the Industrials sector, the company excelled with a growth rate higher than the average among peers.

Analyzing Profitability Metrics:

• 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 significantly higher than the industry average. The company demonstrates a robust bottom-line performance with a current EPS of 2.07.

Debt Management: Watts Water Technologies’s debt-to-equity ratio is below the industry average. With a ratio of 0.13, the company relies less on debt financing, maintaining a healthier balance between debt and equity, which can be viewed positively by investors.

Financial Valuation:

• Price to Earnings (P/E) Ratio: The P/E ratio of 24.85 is lower than the industry average, implying a discounted valuation for Watts Water Technologies’s stock.

• Price to Sales (P/S) Ratio: With a lower-than-average P/S ratio of 3.07, the stock presents an attractive valuation, potentially signaling a buying opportunity for investors interested in sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): At 15.38, Watts Water Technologies’s EV/EBITDA ratio reflects a below-par valuation compared to industry averages signalling undervaluation

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.

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Unmasking the Significance of Insider Transactions

Emphasizing the importance of a comprehensive approach, considering insider transactions is valuable, but it’s crucial to evaluate them in conjunction with other investment factors.

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.

Essential Transaction Codes Unveiled

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 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.