On May 22, 2023, Keh Lu, President & CEO of Diodes Inc (DIOD, Financial), sold 3,683 shares of the company's stock. This sale comes as part of a series of transactions by Keh Lu over the past year, during which he has sold a total of 138,361 shares and purchased none.
Who is Keh Lu?
Keh Lu has been with Diodes Inc since 2005 and has served as the President & CEO of the company since 2006. Under his leadership, Diodes Inc has grown significantly and has become a leading global manufacturer and supplier of high-quality application-specific standard products within the broad discrete, logic, analog, and mixed-signal semiconductor markets.
About Diodes Inc
Diodes Inc is a global semiconductor company that designs, manufactures, and supplies a broad range of standard semiconductor products. The company's product portfolio includes diodes, rectifiers, transistors, MOSFETs, protection devices, functional specific arrays, single gate logic, amplifiers and comparators, Hall-effect and temperature sensors, power management devices, and more. Diodes Inc serves various industries, including automotive, communications, computing, consumer electronics, industrial, and medical.
Insider Buy/Sell Analysis and Stock Price Relationship
Over the past year, there have been no insider buys for Diodes Inc, while there have been 29 insider sells. This trend could indicate that insiders believe the stock is overvalued or that they are taking profits after a period of growth. However, it is essential to consider other factors, such as the company's financial performance and market conditions, before drawing any conclusions.
On the day of Keh Lu's recent sale, Diodes Inc's stock was trading at $95.74 per share, giving the company a market capitalization of $4,174.259 million. The price-earnings ratio of 12.75 is lower than the industry median of 22.41 and lower than the company's historical median price-earnings ratio. This suggests that Diodes Inc's stock may be undervalued compared to its peers and its historical valuation.
With a price of $95.74 and a GuruFocus Value of $97.89, Diodes Inc has a price-to-GF-Value ratio of 0.98, indicating that the stock is fairly valued based on its GF Value. The GF Value is an intrinsic value estimate developed by GuruFocus, calculated using historical multiples, a GuruFocus adjustment factor, and future estimates of business performance from Morningstar analysts.
Conclusion
While the recent insider sell by Keh Lu may raise some concerns, it is essential to consider the broader context of the company's financial performance, valuation, and market conditions. Diodes Inc's stock appears to be fairly valued based on its GF Value, and its price-earnings ratio is lower than the industry median and its historical median. Investors should continue to monitor insider transactions, financial performance, and market trends to make informed decisions about Diodes Inc's stock.
