On September 5, 2023, Preto Del, the CFO and Treasurer of Sprout Social Inc (SPT, Financial), sold 2,776 shares of the company. This move is part of a larger trend of insider selling at Sprout Social Inc, as we will explore in this article.
Sprout Social Inc is a leading provider of social media management and optimization solutions for business. The company's platform provides businesses with the tools they need to manage their social media presence, engage with their audience, and analyze their social media performance. With a market cap of $2.904 billion, Sprout Social Inc is a significant player in the social media management industry.
The insider's trading history shows a clear trend of selling over the past year. In total, the insider has sold 25,155 shares and purchased 0 shares. This trend is consistent with the overall insider activity at Sprout Social Inc, which has seen 46 insider sells and 0 insider buys over the past year. This could indicate that insiders believe the stock is currently overvalued, prompting them to sell their shares.
However, the stock's price and valuation metrics tell a different story. On the day of the insider's recent sell, shares of Sprout Social Inc were trading for $52.62. With a GuruFocus Value of $99.49, the stock has a price-to-GF-Value ratio of 0.53, indicating that it is significantly undervalued.
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 the case of Sprout Social Inc, the GF Value suggests that the stock is significantly undervalued, despite the recent insider selling.
In conclusion, while the insider's recent sell and the overall trend of insider selling at Sprout Social Inc may raise some concerns, the stock's valuation metrics suggest that it is significantly undervalued. Investors should consider these factors and conduct their own research before making investment decisions.
