On May 22, 2023, Gary Yu, the Chief Operating Officer (COO) of Diodes Inc (DIOD, Financial), sold 1000 shares of the company's stock. This move comes amidst a year of insider selling activity for the company, with no insider buys recorded over the past year. In this article, we will take a closer look at Gary Yu's role in Diodes Inc, the company's business description, and analyze the relationship between insider buy/sell transactions and the stock price.
Who is Gary Yu?
Gary Yu serves as the COO of Diodes Inc, a leading global manufacturer and supplier of high-quality application-specific standard products within the broad discrete, logic, analog, and mixed-signal semiconductor markets. With over 25 years of experience in the semiconductor industry, Yu has held various leadership positions in operations, engineering, and product development. As COO, he is responsible for overseeing the company's global operations, including manufacturing, quality, and supply chain management.
Diodes Inc's Business Description
Diodes Inc is a global semiconductor company that designs, manufactures, and supplies a broad range of application-specific standard products for various markets, including automotive, communications, computing, consumer electronics, industrial, and mobile devices. 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 operates globally, with its headquarters in Plano, Texas, and has design, marketing, and engineering facilities in North America, Europe, and Asia.
Insider Buy/Sell Analysis and Stock Price Relationship
Over the past year, Gary Yu has sold a total of 5275 shares and purchased 0 shares. The insider transaction history for Diodes Inc shows that there have been 0 insider buys in total over the past year, while there have been 29 insider sells during the same period. This trend suggests that insiders may have a bearish outlook on the company's stock or are taking advantage of the current stock price to realize gains.
Valuation
On the day of Gary Yu's recent sell, shares of Diodes Inc were trading at $95.07 apiece, giving the stock a market cap of $4,380.459 million. The price-earnings ratio is 13.38, which is lower than the industry median of 22.89 and lower than the company's historical median price-earnings ratio. This indicates that the stock may be undervalued compared to its peers and its historical valuation.
With a price of $95.07 and a GuruFocus Value of $97.91, Diodes Inc has a price-to-GF-Value ratio of 0.97. This means the stock is fairly valued based on its GF Value. The GF Value is an intrinsic value estimate developed by GuruFocus, calculated based on the following three factors:
- Historical multiples (price-earnings ratio, price-sales ratio, price-book ratio, and price-to-free cash flow) that the stock has traded at.
- A GuruFocus adjustment factor based on the company's past returns and growth.
- Future estimates of business performance from Morningstar analysts.
In conclusion, the recent insider sell by Diodes Inc's COO Gary Yu may raise some concerns among investors, considering the overall trend of insider selling over the past year. However, the stock's valuation suggests that it is fairly valued based on its GF Value, and its lower price-earnings ratio compared to the industry median and historical median may indicate potential undervaluation. Investors should keep a close eye on the company's performance and any further insider transactions to make informed decisions about their investments in Diodes Inc.
