UDR Chairman and CEO Sold $3.56M In Company Stock

Disclosed on June 10, Thomas W Toomey, Chairman and CEO at UDR UDR, executed a substantial insider sell as per the latest SEC filing.

What Happened: A Form 4 filing from the U.S. Securities and Exchange Commission on Monday showed that Toomey sold 90,000 shares of UDR. The total transaction amounted to $3,556,475.

The latest update on Tuesday morning shows UDR shares down by 0.0%, trading at $39.83.

Get to Know UDR Better

UDR is a real estate investment trust that owns, operates, acquires, renovates, develops, redevelops, disposes of, and manages multifamily apartment communities in targeted markets located in the United States. The company has two reportable segments; Same-Store Communities segment represents those communities acquired, developed, and stabilized prior to January 1, 2021, and held as of December 31, 2022, and Non-Mature Communities/Other segment represents those communities that do not meet the criteria to be included in Same-Store Communities, including, but not limited to, recently acquired, developed and redeveloped communities, and the non-apartment components of mixed-use properties. The company generates key revenue from Same-Store Communities.

UDR's Economic Impact: An Analysis

Revenue Growth: UDR's remarkable performance in 3 months is evident. As of 31 March, 2024, the company achieved an impressive revenue growth rate of 3.53%. This signifies a substantial increase in the company's top-line earnings. As compared to competitors, the company surpassed expectations with a growth rate higher than the average among peers in the Real Estate sector.

Holistic Profitability Examination:

  • Gross Margin: The company faces challenges with a low gross margin of 23.72%, suggesting potential difficulties in cost control and profitability compared to its peers.

  • Earnings per Share (EPS): UDR's EPS is below the industry average. The company faced challenges with a current EPS of 0.13. This suggests a potential decline in earnings.

Debt Management: UDR's debt-to-equity ratio surpasses industry norms, standing at 1.54. This suggests the company carries a substantial amount of debt, posing potential financial challenges.

Valuation Overview:

  • Price to Earnings (P/E) Ratio: The current P/E ratio of 28.86 is below industry norms, indicating potential undervaluation and presenting an investment opportunity.

  • Price to Sales (P/S) Ratio: A higher-than-average P/S ratio of 7.98 suggests overvaluation in the eyes of investors, considering sales performance.

  • EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): The company's EV/EBITDA ratio 13.96 is above the industry average, suggesting that the market values the company more highly for each unit of EBITDA. This could be attributed to factors such as strong growth prospects or superior operational efficiency.

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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Navigating the Impact of Insider Transactions on Investments

Insider transactions shouldn't be used primarily to make an investing decision, however an insider transaction can be an important factor in the investing decision.

Considering the legal perspective, an "insider" is defined as any officer, director, or beneficial owner holding more than ten percent of a company's equity securities, according to 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.

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

Nevertheless, insider sells may not necessarily indicate a bearish view and can be influenced by various factors.

A Closer Look at Important Transaction Codes

For investors, a primary focus lies on transactions occurring in the open market, as indicated 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 UDR's Insider Trades.

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

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