On May 22, 2023, Michael Brown, CEO and President of Euronet Worldwide Inc (EEFT, Financial), sold 50,000 shares of the company's stock. This move comes amidst a year where Brown has sold a total of 65,689 shares and purchased none. The insider transaction history for Euronet Worldwide Inc reveals that there have been no insider buys over the past year, while there have been two insider sells during the same period.
Who is Michael Brown?
Michael Brown has been the CEO and President of Euronet Worldwide Inc since 1994. Under his leadership, the company has grown into a global leader in electronic financial transaction processing and distribution. Brown's extensive experience in the industry has been instrumental in driving the company's growth and success.
About Euronet Worldwide Inc
Euronet Worldwide Inc is a leading global provider of electronic payment and transaction processing solutions for financial institutions, retailers, service providers, and individual consumers. The company operates in three segments: Electronic Financial Transactions (EFT), epay, and Money Transfer. Euronet's services include comprehensive ATM, POS, and card outsourcing services, card issuing and merchant acquiring services, software solutions, cash-based and online-initiated consumer-to-consumer and business-to-business money transfer services, and electronic distribution of prepaid mobile phone time and other prepaid products.
Analysis of Insider Buy/Sell and Relationship with Stock Price
Insider transactions can provide valuable insights into a company's prospects and the confidence of its management. In the case of Euronet Worldwide Inc, the absence of insider buys over the past year may raise questions about the company's growth potential. However, it is essential to consider other factors, such as the company's valuation and financial performance, before drawing any conclusions.
Valuation
On the day of Michael Brown's recent sale, shares of Euronet Worldwide Inc were trading at $120.69 apiece, giving the stock a market cap of $5,601.373 million. The price-earnings ratio stands at 24.20, which is lower than the industry median of 26.81 and lower than the company's historical median price-earnings ratio.
With a price of $120.69 and a GuruFocus Value of $137.39, Euronet Worldwide Inc has a price-to-GF-Value ratio of 0.88. This indicates that the stock is modestly undervalued 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, while the recent insider sell by CEO & President Michael Brown may raise some concerns, it is essential to consider the broader context of Euronet Worldwide Inc's valuation and financial performance. The stock appears to be modestly undervalued based on its GF Value, and the company's lower-than-industry-average price-earnings ratio may present an opportunity for investors seeking exposure to the electronic financial transaction processing sector.
