On September 18, 2023, Thomas Frank, the Chief Information Officer of Interactive Brokers Group Inc (IBKR, Financial), sold 52,335 shares of the company. This move is part of a series of transactions made by the insider over the past year, which saw a total of 436,444 shares sold and no shares purchased.
Interactive Brokers Group Inc is a leading electronic brokerage firm. It provides automated trade execution and clearing of securities, commodities, and foreign exchange around the clock, around the globe. The company caters to professional traders, institutions, and financial advisors.
The insider's recent sell-off is part of a broader trend within the company. Over the past year, there have been 43 insider sells and no insider buys. This trend is illustrated in the following image:
The relationship between insider transactions and the stock price is often closely watched by investors. In the case of Interactive Brokers Group Inc, the stock was trading at $91.23 per share on the day of the insider's recent sell. This gives the company a market cap of $9.58 billion.
The company's price-earnings ratio stands at 18.50, slightly higher than the industry median of 18.41, but lower than the company’s historical median price-earnings ratio. This suggests that the stock is currently trading at a fair value relative to its earnings.
However, when we consider the GuruFocus Value of $104.98, the stock appears to be modestly undervalued. The price-to-GF-Value ratio of 0.87 supports this view. The GF Value is an intrinsic value estimate developed by GuruFocus, based on historical multiples, a GuruFocus adjustment factor, and future business performance estimates from Morningstar analysts.
In conclusion, the insider's recent sell-off, coupled with the broader trend of insider sells at Interactive Brokers Group Inc, may raise some eyebrows among investors. However, the company's current valuation suggests that the stock is modestly undervalued, which could present a buying opportunity for those who believe in the company's long-term prospects.
