Mark E. Mikes, President Electrical Solutions at Hubbell HUBB, executed a substantial insider sell on November 12, according to an SEC filing.

What Happened: Mikes opted to sell 1,144 shares of Hubbell, according to a Form 4 filing with the U.S. Securities and Exchange Commission on Tuesday. The transaction’s total worth stands at $533,328.

As of Wednesday morning, Hubbell shares are up by 0.61%, currently priced at $454.77.

Unveiling the Story Behind Hubbell

Hubbell is a diversified conglomerate industrial company that mostly competes in the electrical components market. Its products and services serve vital portions of the U.S. electrical supply chain, including transmission and distribution as well as the commercial, industrial, and residential end markets. The company organizes its business into two segments: Utility Solutions Segment and the Electrical Solutions Segment. It derives maximum revenue from Utility Solutions Segment.

A Deep Dive into Hubbell’s Financials

Revenue Growth: Hubbell displayed positive results in 3 months. As of 30 September, 2024, the company achieved a solid revenue growth rate of approximately 4.86%. 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.

Key Profitability Indicators:

• Gross Margin: The company shows a low gross margin of 34.46%, suggesting potential challenges in cost control and profitability compared to its peers.

• Earnings per Share (EPS): Hubbell’s EPS is significantly higher than the industry average. The company demonstrates a robust bottom-line performance with a current EPS of 4.08.

Debt Management: Hubbell’s debt-to-equity ratio surpasses industry norms, standing at 0.65. This suggests the company carries a substantial amount of debt, posing potential financial challenges.

In-Depth Valuation Examination:

• Price to Earnings (P/E) Ratio: Hubbell’s P/E ratio of 32.54 is below the industry average, suggesting the stock may be undervalued.

• Price to Sales (P/S) Ratio: With a relatively high Price to Sales ratio of 4.33 as compared to the industry average, the stock might be considered overvalued based on sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): With an impressive EV/EBITDA ratio of 20.92, Hubbell demonstrates exemplary market valuation, surpassing industry averages.

Market Capitalization Analysis: The company’s market capitalization is above the industry average, indicating that it is relatively larger in size compared to peers. This may suggest a higher level of investor confidence and market recognition.

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Uncovering the Importance of Insider Activity

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.

Navigating the World of Insider Transaction Codes

Taking a closer look at transactions, investors often prioritize those unfolding in the open market, meticulously cataloged in Table I of the Form 4 filing. A P in Box 3 denotes a purchase, while S signifies a sale. Transaction code C denotes the conversion of an option, and transaction code A signifies a grant, award, or other acquisition of securities from the company.

Check Out The Full List Of Hubbell’s Insider Trades.

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