CARL ICAHN, 10% Owner at Southwest Gas Hldgs SWX, executed a substantial insider sell on November 20, according to an SEC filing.

What Happened: ICAHN’s decision to sell 1,390,000 shares of Southwest Gas Hldgs was revealed in a Form 4 filing with the U.S. Securities and Exchange Commission on Wednesday. The total value of the sale is $106,668,600.

During Wednesday’s morning session, Southwest Gas Hldgs shares down by 0.0%, currently priced at $79.11.

Unveiling the Story Behind Southwest Gas Hldgs

Southwest Gas Holdings Inc is a utility company engaged in the purchasing, distributing, and transporting of natural gas in the American Southwest. The company segments its activities into natural gas distribution and Utility Infrastructure Services units. The first of these encompasses the company’s core natural gas business as distributors in the states of Arizona and Nevada. The natural gas distribution division is responsible for roughly half of Southwest Gas’ total revenue through the sale of natural gas to mainly residential and small commercial customers. The Utility Infrastructure Services segment generates the other half of the company’s total revenue from the underground piping contractor services that its subsidiary, Centuri Construction Group, provides.

Southwest Gas Hldgs: A Financial Overview

Decline in Revenue: Over the 3 months period, Southwest Gas Hldgs faced challenges, resulting in a decline of approximately -7.72% in revenue growth as of 30 September, 2024. This signifies a reduction in the company’s top-line earnings. When compared to others in the Utilities sector, the company faces challenges, achieving a growth rate lower than the average among peers.

Profitability Metrics:

• Gross Margin: The company shows a low gross margin of 17.71%, indicating concerns regarding cost management and overall profitability relative to its industry counterparts.

• Earnings per Share (EPS): Southwest Gas Hldgs’s EPS is a standout, portraying a positive bottom-line trend that exceeds the industry average with a current EPS of 0.004021.

Debt Management: Southwest Gas Hldgs’s debt-to-equity ratio stands notably higher than the industry average, reaching 1.47. This indicates a heavier reliance on borrowed funds, raising concerns about financial leverage.

Valuation Metrics: A Closer Look

• Price to Earnings (P/E) Ratio: Southwest Gas Hldgs’s stock is currently priced at a premium level, as reflected in the higher-than-average P/E ratio of 31.64.

• Price to Sales (P/S) Ratio: The current P/S ratio of 1.09 is below industry norms, suggesting potential undervaluation and presenting an investment opportunity for those considering sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): At 10.91, Southwest Gas Hldgs’s EV/EBITDA ratio reflects a below-par valuation compared to industry averages signalling undervaluation

Market Capitalization Analysis: Above industry benchmarks, the company’s market capitalization emphasizes a noteworthy size, indicative of a strong market presence.

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Exploring the Significance of Insider Trading

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

From a legal standpoint, the term “insider” pertains to any officer, director, or beneficial owner holding more than ten percent of a company’s equity securities as outlined in Section 12 of the Securities Exchange Act of 1934. This encompasses executives in the c-suite and significant hedge funds. These insiders are mandated to inform the public of their transactions through a Form 4 filing, to be submitted within two business days of the transaction.

A company insider’s new purchase is a indicator of their positive anticipation for a rise in the stock.

While insider sells may not necessarily reflect a bearish view and can be motivated by various factors.

Navigating the World of Insider Transaction Codes

Surveying the realm of stock transactions, investors often give prominence to those unfolding in the open market, systematically detailed in Table I of the Form 4 filing. A P in Box 3 indicates a purchase, while S signifies a sale. Transaction code C denotes 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 Southwest Gas Hldgs’s Insider Trades.

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