Steel Partners Holdings LP and its affiliated entities recently made significant purchases of Steel Connect, Inc. (NASDAQ:STCN) stock, latest filings with the Securities and Exchange Commission indicate. In a series of transactions, these entities acquired a total of $390,000 worth of shares, with prices ranging from $8.9314 to $9.4428 per share.
The buying spree featured transactions on three consecutive days, starting with the purchase of 18,605 shares at $8.9314 each, followed by 23,698 shares at $9.4428 the next day and a smaller purchase of 6 shares at $9.3500 dollars on the last day. These transactions reflect continued interest and confidence in Steel Connect by Steel Partners and its associated entities.
Steel Partners Holdings LP, together with SPH Group LLC, SPH Group Holdings LLC, Steel Partners Holdings GP Inc., Steel Excel Inc., WF Asset Corp., Handy & Harman Ltd. and WHX CS LLC, are connected by a complex network of ownership and control. Steel Partners Holdings LP directly or indirectly holds majority interests in these entities, which in turn hold significant stakes in Steel Connect.
Investors who track insider transactions may find these purchases noteworthy, as they represent a substantial investment by entities closely tied to the company’s board members. However, the filings indicate that the reporting entities relinquish beneficial ownership of shares held by each other, despite their intertwined relationships.
The recent acquisitions highlight the intricate connections within the Steel Partners family of companies and their collective actions in the marketplace. For investors, such transactions often signal confidence in the company’s prospects, as insiders are typically privy to detailed information about the company’s operations and future plans.
Insights on InvestingPro
In light of recent insider transactions at Steel Connect, Inc. (NASDAQ:STCN), where Steel Partners Holdings LP and affiliated entities significantly increased their stake in the company, several metrics and recommendations from InvestingPro may offer additional insights for investors. The company’s management has been actively repurchasing shares, which can be interpreted as a sign of confidence in the company’s value and future performance. Furthermore, Steel Connect holds more cash than debt on its balance sheet, indicating a strong financial position that could support future growth or provide a cushion against market volatility.
Key real-time data from InvestingPro includes a market capitalization of $61.26 million and a price-to-earnings (P/E) ratio of 9.59. Specifically, the adjusted P/E ratio for the trailing twelve months starting in the second quarter of 2024 is 13.73. This lower earnings multiple, coupled with a significant past-week yield of 10.22%, could suggest that the stock is undervalued relative to its earnings potential, especially considering the company’s strong free cash flow yield, as implicit in his assessment.
InvestingPro tips also highlight that Steel Connect trades at a low earnings multiple and has a high shareholder return. These factors, combined with the company’s profitability over the past twelve months and the fact that its cash exceeds near-term obligations, provide a reassuring financial picture for current and potential investors.
For those interested in more in-depth analysis, InvestingPro offers additional insights into the company’s financial health and market performance. There are currently 6 more InvestingPro tips available, which can be accessed via the dedicated link for Steel Connect. To improve your investment research, use the coupon code PRONEWS24 to get an additional 10% discount on an annual or two-year Pro and Pro+ subscription.
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