Published on 26 August Adrian V MitchellEVP at Macy’s Mhas conducted a large insider sale according to its recent SEC filing.

What happened: Mitchell’s decision to sell 12,000 shares of Macy’s was announced Monday in a Form 4 filing with the U.S. Securities and Exchange Commission. The total value of the sale is $191,076.

The latest update on Tuesday morning shows Macy’s Shares fell 0.89% to trade at $15.62.

Delve into the background of Macy’s

Founded in 1858 and based in New York City, Macy’s operates approximately 500 stores under the Macy’s name, nearly 60 stores under the Bloomingdale’s (full-price and outlet) and Bloomie’s names, and 159 stand-alone Bluemercury specialty beauty stores. Macy’s also operates e-commerce sites and licenses Bloomingdale’s stores in the United Arab Emirates and Kuwait. Women’s clothing, accessories, shoes, cosmetics and fragrances accounted for 62% of Macy’s 2023 revenue.

Financial Insights: Macy’s

Sales growth: Macy’s showed positive results in 3 months. As of July 31, 2024, the company achieved a solid sales growth rate of approximately 1.92%This indicates a significant increase in the company’s revenue. Compared to its industry peers, the company is lagging as its growth rate is below the average of its peers in the Consumer Discretionary sector.

Profitability indicators:

• Gross margin: The company sets standards with a high gross profit margin of 42.35%which suggests better cost management and higher profitability than competitors.

• Earnings per share (EPS): Macy’s earnings per share are below the industry average. The company has faced challenges with current earnings per share of 0.54This indicates a possible decline in profits.

Debt management: Macy’s debt ratio is well above the industry average and reaches 1.4This indicates a greater dependence on borrowed funds and raises concerns about indebtedness.

Rating overview:

• Price-earnings ratio (P/E): The current P/E ratio of 24.25 is below the industry norm, indicating a possible undervaluation and represents an investment opportunity.

• Price-to-sales ratio (P/S): With a below-average P/S ratio of 0.19The stock has an attractive valuation and may signal a buying opportunity for investors interested in sales development.

• EV/EBITDA analysis (enterprise value in relation to earnings before interest, taxes, depreciation and amortization): Macy’s EV/EBITDA ratio is below the industry average at 7.78indicates attractively valued shares.

Market capitalization analysis: The company’s market capitalization is below industry benchmarks and reflects a smaller size compared to peers. This positioning may be influenced by factors such as growth expectations or operating capacity.

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Why insider transactions are important

Although insider transactions should not be the sole basis for investment decisions, they can play a significant role in an investor’s decision-making process.

From a legal perspective, the term “insider” refers to any officer, director, or beneficial owner who owns more than ten percent of a company’s stock, as defined in Section 12 of the Securities Exchange Act of 1934. This includes senior executives and major hedge funds. These insiders are required to disclose their transactions to the public through a Form 4, which must be filed within two business days of the transaction.

A new purchase by a company insider is an indicator of his positive expectation of a share price increase.

Insider selling does not necessarily reflect a pessimistic assessment and can have various reasons.

Deciphering the meaning of transaction codes

When analyzing transactions, investors typically focus on the open market transactions listed in Table I of Form 4. P in Box 3 indicates a purchase, while S means a sale. Transaction code C signals the conversion of an option and the transaction code A means a grant, assignment or other acquisition of securities of the company.

See the full list of Macy’s insider trades.

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