JOHN FISHER, Vice President at Federated Hermes FHI, reported an insider sell on November 20, according to a new SEC filing.

What Happened: FISHER opted to sell 7,817 shares of Federated Hermes, according to a Form 4 filing with the U.S. Securities and Exchange Commission on Wednesday. The transaction’s total worth stands at $323,336.

In the Thursday’s morning session, Federated Hermes‘s shares are currently trading at $41.42, experiencing a down of 0.0%.

Discovering Federated Hermes: A Closer Look

Federated Hermes provides asset-management services for institutional and individual investors. The firm had $782.7 billion in managed assets at the end of June 2024, composed of equity (10%), multi-asset (less than 1%), fixed-income (12%), alternative (3%), and money market (75%) funds. The firm’s cash-management operations are expected to generate around 50% of Federated’s revenue this year, compared with 28%, 12%, and 10%, respectively, for the equity, fixed-income, and alternatives/multi-asset operations. The company’s products are distributed via trust banks, wealth managers, and retail broker/dealers (64% of AUM), institutional investors (27%), and international clients (9%).

Federated Hermes’s Financial Performance

Revenue Growth: Federated Hermes’s revenue growth over a period of 3 months has been noteworthy. As of 30 September, 2024, the company achieved a revenue growth rate of approximately 1.44%. This indicates a substantial increase in the company’s top-line earnings. When compared to others in the Financials sector, the company faces challenges, achieving a growth rate lower than the average among peers.

Key Insights into Profitability Metrics:

• Gross Margin: With a high gross margin of 66.7%, the company demonstrates effective cost control and strong profitability relative to its peers.

• Earnings per Share (EPS): Federated Hermes’s EPS lags behind the industry average, indicating concerns and potential challenges with a current EPS of 1.06.

Debt Management: Federated Hermes’s debt-to-equity ratio is below industry norms, indicating a sound financial structure with a ratio of 0.41.

Valuation Overview:

• Price to Earnings (P/E) Ratio: With a lower-than-average P/E ratio of 13.11, the stock indicates an attractive valuation, potentially presenting a buying opportunity.

• Price to Sales (P/S) Ratio: With a lower-than-average P/S ratio of 2.08, 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): With an EV/EBITDA ratio lower than industry averages at 7.75, Federated Hermes could be considered undervalued.

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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Why Insider Transactions Are Key in Investment Decisions

In the complex landscape of investment decisions, investors should approach insider transactions as part of a comprehensive analysis, considering various elements.

In legal terms, an “insider” refers to any officer, director, or beneficial owner of more than ten percent of a company’s equity securities registered under Section 12 of the Securities Exchange Act of 1934. This can include executives in the c-suite and large hedge funds. These insiders are required to let the public know of their transactions via a Form 4 filing, which must be filed within two business days of the transaction.

When a company insider makes a new purchase, that is an indication that they expect the stock to rise.

Insider sells, on the other hand, can be made for a variety of reasons, and may not necessarily mean that the seller thinks the stock will go down.

Transaction Codes Worth Your Attention

Navigating through the landscape of transactions, investors often prioritize those unfolding in the open market, precisely 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 Federated Hermes’s Insider Trades.

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