Denise Dillard Mahaffy's Recent Buy: Acquires $60K In Dillard's Stock

Denise Dillard Mahaffy, Senior Vice President at Dillard’s DDS, disclosed an insider purchase on February 3, based on a new SEC filing.

What Happened: In a recent Form 4 filing with the U.S. Securities and Exchange Commission on Monday, Mahaffy increased their investment in Dillard’s by purchasing 129 shares through open-market transactions, signaling confidence in the company’s potential. The total transaction value is $60,524.

Dillard’s shares are trading down 0.62% at $458.53 at the time of this writing on Tuesday morning.

About Dillard’s

Dillard’s Inc is an American fashion apparel, cosmetics, and home furnishings retailer. Its stores offer a large variety of merchandise and feature products from both national and exclusive brand sources. The company also operates a general contracting construction company, CDI Contractors. CDI Contractors’ business includes constructing and remodelling stores for Dillards. The merchandise selections include exclusive brand merchandise such as Antonio Melani, Gianni Bini, Daniel Cremieux, Roundtree & Yorke, and private-label merchandise, among others. The company operates in two business segments; Retail Operations and Construction. The Retail Operations segment generates maximum revenue for the company.

Unraveling the Financial Story of Dillard’s

Revenue Growth: Dillard’s’s revenue growth over a period of 3 months has faced challenges. As of 31 October, 2024, the company experienced a revenue decline of approximately -3.53%. This indicates a decrease in the company’s top-line earnings. As compared to competitors, the company encountered difficulties, with a growth rate lower than the average among peers in the Consumer Discretionary sector.

Evaluating Earnings Performance:

• Gross Margin: With a low gross margin of 43.54%, the company exhibits below-average profitability, signaling potential struggles in cost efficiency compared to its industry peers.

• Earnings per Share (EPS): Dillard’s’s EPS outshines the industry average, indicating a strong bottom-line trend with a current EPS of 7.73.

Debt Management: Dillard’s’s debt-to-equity ratio is below the industry average. With a ratio of 0.28, the company relies less on debt financing, maintaining a healthier balance between debt and equity, which can be viewed positively by investors.

Financial Valuation:

• Price to Earnings (P/E) Ratio: The current P/E ratio of 11.9 is below industry norms, indicating potential undervaluation and presenting an investment opportunity.

• Price to Sales (P/S) Ratio: With a P/S ratio of 1.12 below industry standards, the stock shows potential undervaluation, making it an appealing investment option for those focusing on sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): Dillard’s’s EV/EBITDA ratio at 6.79 suggests potential undervaluation, falling below industry averages.

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

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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.

Breaking Down the Significance of Transaction Codes

Delving into transactions, investors typically prioritize those unfolding in the open market, as precisely outlined in Table I of the Form 4 filing. A P in Box 3 indicates 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 Dillard’s’s Insider Trades.

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