On August 31, 2023, Jason Vlacich, Chief Accounting Officer of Target Hospitality Corp (TH, Financial), sold 15,120 shares of the company. This move comes amidst a year where the insider has sold a total of 113,120 shares and purchased none.
But who is Jason Vlacich? He is the Chief Accounting Officer of Target Hospitality Corp, a company that specializes in rental and logistical services. The company provides a wide range of services including accommodation, catering, and hospitality solutions primarily for the oil and gas industry. With a market cap of $1.623 billion, Target Hospitality Corp is a significant player in its industry.
The insider's recent sell has raised eyebrows in the financial community, prompting a closer look at the company's insider trading trends and its relationship with the stock price.
The insider transaction history for Target Hospitality Corp shows a trend of more sells than buys over the past year. There have been 2 insider buys in total, compared to 15 insider sells. This could indicate that insiders believe the company's stock is overvalued, prompting them to sell their shares.
On the day of the insider's recent sell, shares of Target Hospitality Corp were trading for $16 apiece. This gives the stock a price-earnings ratio of 12.02, which is lower than the industry median of 17.01 and lower than the company’s historical median price-earnings ratio. This could suggest that the stock is undervalued based on its earnings.
However, when we look at the stock's price-to-GF-Value ratio, a different picture emerges. With a price of $16 and a GuruFocus Value of $10.13, Target Hospitality Corp has a price-to-GF-Value ratio of 1.58. This means the stock is significantly overvalued based on its GF Value.
The GF Value is an intrinsic value estimate developed by GuruFocus. It is calculated based on historical multiples that the stock has traded at, a GuruFocus adjustment factor based on the company’s past returns and growth, and future estimates of business performance from Morningstar analysts.
In conclusion, the insider's recent sell of Target Hospitality Corp shares, coupled with the company's insider trading trends and valuation metrics, suggest that the stock may be overvalued. Investors should exercise caution and conduct further research before making investment decisions.
