Southwest Gas Hldgs 10% Owner Sold $156.66M In Company Stock

CARL ICAHN, 10% Owner at Southwest Gas Hldgs SWX, reported an insider sell on March 25, according to a new SEC filing.

What Happened: After conducting a thorough analysis, ICAHN sold 2,100,000 shares of Southwest Gas Hldgs. This information was disclosed in a Form 4 filing with the U.S. Securities and Exchange Commission on Tuesday. The total transaction value is $156,660,000.

Monitoring the market, Southwest Gas Hldgs‘s shares down by 1.32% at $71.99 during Wednesday’s morning.

Get to Know Southwest Gas Hldgs Better

Southwest Gas Holdings Inc is a utility company engaged in the purchasing, distributing, and transporting of natural gas in the American Southwest. The company segments its activities into natural gas distribution and Utility Infrastructure Services units. The first of these encompasses the company’s core natural gas business as distributors in the states of Arizona and Nevada. The natural gas distribution division is responsible for roughly half of Southwest Gas’ total revenue through the sale of natural gas to mainly residential and small commercial customers. The Utility Infrastructure Services segment generates the other half of the company’s total revenue from the underground piping contractor services that its subsidiary, Centuri Construction Group, provides.

Financial Milestones: Southwest Gas Hldgs’s Journey

Negative Revenue Trend: Examining Southwest Gas Hldgs’s financials over 3 months reveals challenges. As of 31 December, 2024, the company experienced a decline of approximately -7.12% in revenue growth, reflecting a decrease in top-line earnings. As compared to its peers, the revenue growth lags behind its industry peers. The company achieved a growth rate lower than the average among peers in Utilities sector.

Insights into Profitability:

• Gross Margin: The company faces challenges with a low gross margin of 25.14%, suggesting potential difficulties in cost control and profitability compared to its peers.

• Earnings per Share (EPS): Southwest Gas Hldgs’s EPS outshines the industry average, indicating a strong bottom-line trend with a current EPS of 1.29.

Debt Management: Southwest Gas Hldgs’s debt-to-equity ratio stands notably higher than the industry average, reaching 1.44. This indicates a heavier reliance on borrowed funds, raising concerns about financial leverage.

Navigating Market Valuation:

• Price to Earnings (P/E) Ratio: A higher-than-average P/E ratio of 26.43 suggests caution, as the stock may be overvalued in the eyes of investors.

• Price to Sales (P/S) Ratio: The current P/S ratio of 1.03 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): At 10.17, Southwest Gas Hldgs’s EV/EBITDA ratio reflects a below-par valuation compared to industry averages signalling undervaluation

Market Capitalization: Indicating a reduced size compared to industry averages, the company’s market capitalization poses unique challenges.

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Why Pay Attention to Insider Transactions

Insider transactions contribute to decision-making but should be supplemented by a comprehensive investment analysis.

From a legal standpoint, the term “insider” pertains to any officer, director, or beneficial owner holding more than ten percent of a company’s equity securities as outlined in Section 12 of the Securities Exchange Act of 1934. This encompasses executives in the c-suite and significant hedge funds. These insiders are mandated to inform the public of their transactions through a Form 4 filing, to be submitted within two business days of the transaction.

A company insider’s new purchase is a indicator of their positive anticipation for a rise in the stock.

While insider sells may not necessarily reflect a bearish view and can be motivated by various factors.

Navigating the World of Insider 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 Southwest Gas Hldgs’s Insider Trades.

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