Insider Move: Mark Lowell Keim Invests $5.74M In Molina Healthcare Stock

Mark Lowell Keim, Chief Financial Officer at Molina Healthcare MOH, disclosed an insider purchase on March 5, based on a new SEC filing.

What Happened: In a significant move reported in a Form 4 filing with the U.S. Securities and Exchange Commission on Wednesday, Keim purchased 19,425 shares of Molina Healthcare, demonstrating confidence in the company’s growth potential. The total value of the transaction stands at $5,736,455.

At Wednesday morning, Molina Healthcare shares are up by 0.81%, trading at $308.96.

Get to Know Molina Healthcare Better

Molina Healthcare Inc offers healthcare plans focused on Medicaid-related solutions for low-income families and individuals. Its health plans are operated by a network of subsidiaries, each of which is licensed as a health maintenance organization (HMO). It has four segments: Medicaid, Medicare, Marketplace and Others. The Medicaid, Medicare, and Marketplace segments represent the government-funded or sponsored programs under which it offers managed healthcare services. The Other segment, which is insignificant to its consolidated results of operations, includes long-term services and supports consultative services in Wisconsin. It generates majority revenue from Medicaid segment.

Unraveling the Financial Story of Molina Healthcare

Revenue Growth: Molina Healthcare’s revenue growth over a period of 3 months has been noteworthy. As of 31 December, 2024, the company achieved a revenue growth rate of approximately 16.04%. This indicates 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 Health Care sector.

Key Profitability Indicators:

• Gross Margin: The company shows a low gross margin of 10.6%, indicating concerns regarding cost management and overall profitability relative to its industry counterparts.

• Earnings per Share (EPS): Molina Healthcare’s EPS is significantly higher than the industry average. The company demonstrates a robust bottom-line performance with a current EPS of 4.482143.

Debt Management: Molina Healthcare’s debt-to-equity ratio stands notably higher than the industry average, reaching 0.69. This indicates a heavier reliance on borrowed funds, raising concerns about financial leverage.

Exploring Valuation Metrics Landscape:

• Price to Earnings (P/E) Ratio: With a lower-than-average P/E ratio of 15.01, the stock indicates an attractive valuation, potentially presenting a buying opportunity.

• Price to Sales (P/S) Ratio: The current P/S ratio of 0.44 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): With an EV/EBITDA ratio lower than industry averages at 5.89, Molina Healthcare 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 Pay Attention to Insider Transactions

Emphasizing the importance of a comprehensive approach, considering insider transactions is valuable, but it’s crucial to evaluate them in conjunction with other investment factors.

Within the legal framework, an “insider” is defined as any officer, director, or beneficial owner holding more than ten percent of a company’s equity securities as per 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.

The initiation of a new purchase by a company insider serves as a strong indication that they expect the stock to rise.

However, insider sells may not always signal a bearish view and can be influenced by various factors.

Important 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 Molina Healthcare’s Insider Trades.

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