Insider Transaction: Ryan Stafford Sells $470K Worth Of Littelfuse Shares

Ryan Stafford, EVP at Littelfuse LFUS, reported an insider sell on February 9, according to a new SEC filing.

What Happened: A Form 4 filing from the U.S. Securities and Exchange Commission on Friday showed that Stafford sold 1,932 shares of Littelfuse. The total transaction amounted to $470,670.

Monitoring the market, Littelfuse's shares down by 0.0% at $241.91 during Friday's morning.

Get to Know Littelfuse Better

Littelfuse is a primary provider of circuit protection products (such as fuses and relays) into the transportation, industrial, telecommunications, and consumer electronics end markets. The firm is also increasing its power semiconductor business, where it predominantly serves industrial end markets and is breaking into electric vehicle charging infrastructure. Littelfuse has 17,000 global employees.

Unraveling the Financial Story of Littelfuse

Negative Revenue Trend: Examining Littelfuse's financials over 3 months reveals challenges. As of 31 December, 2023, the company experienced a decline of approximately -12.07% in revenue growth, reflecting a decrease in top-line earnings. In comparison to its industry peers, the company trails behind with a growth rate lower than the average among peers in the Information Technology sector.

Analyzing Profitability Metrics:

  • Gross Margin: Achieving a high gross margin of 36.26%, the company performs well in terms of cost management and profitability within its sector.

  • Earnings per Share (EPS): Littelfuse's EPS outshines the industry average, indicating a strong bottom-line trend with a current EPS of 1.72.

Debt Management: The company faces challenges in debt management with a debt-to-equity ratio higher than the industry average. With a ratio of 0.37, caution is advised due to increased financial risk.

Assessing Valuation Metrics:

  • Price to Earnings (P/E) Ratio: Littelfuse's current Price to Earnings (P/E) ratio of 23.41 is higher than the industry average, indicating that the stock may be overvalued according to market sentiment.

  • Price to Sales (P/S) Ratio: With a relatively high Price to Sales ratio of 2.57 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): Littelfuse's EV/EBITDA ratio, surpassing industry averages at 14.72, positions it with an above-average valuation in the market.

Market Capitalization: With restricted market capitalization, the company is positioned below industry averages. This reflects a smaller scale relative to peers.

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Why Pay Attention to Insider Transactions

Insider transactions should be considered alongside other factors when making investment decisions, as they can offer important insights.

In the context of legal matters, the term "insider" refers to any officer, director, or beneficial owner holding more than ten percent of a company's equity securities, as outlined by Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and significant hedge funds. Such insiders are obligated to report their transactions through a Form 4 filing, which must be completed within two business days of the transaction.

Pointing towards optimism, a company insider's new purchase signals their positive anticipation for the stock to rise.

Despite insider sells not always signaling a bearish sentiment, they can be driven by various factors.

Unlocking the Meaning of 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 Littelfuse's Insider Trades.

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

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