On September 12, 2023, Jason Vlacich, Chief Accounting Officer of Target Hospitality Corp (NASDAQ:TH), sold 895 shares of the company. This move is part of a larger trend, as over the past year, the insider has sold a total of 118,866 shares and purchased none.
Jason Vlacich has been with Target Hospitality Corp for several years, serving in various financial roles before becoming the Chief Accounting Officer. His role involves overseeing the company's financial reporting and compliance, making him a key figure in the company's financial operations.
Target Hospitality Corp is a leading provider of specialty rental accommodations and value-added hospitality services in the U.S. The company primarily serves the oil and gas industry, providing cost-effective and customized solutions for their workforce housing and logistical needs.
The insider's recent sell has raised some eyebrows, especially considering the overall insider trading trend at Target Hospitality Corp. Over the past year, there have been 2 insider buys and 17 insider sells, indicating a possible bearish sentiment within the company.
The relationship between insider trading and stock price is often closely watched by investors. In this case, the stock was trading at $16.05 per share on the day of the insider's recent sell, giving the company a market cap of $1.42 billion. This is a significant figure, especially considering the company's price-earnings ratio of 10.49, which is lower than both the industry median of 16.68 and the company's historical median.
However, despite the seemingly attractive price-earnings ratio, the stock appears to be significantly overvalued based on its GF Value. With a price of $16.05 and a GuruFocus Value of $10.06, the stock has a price-to-GF-Value ratio of 1.6.
The GF Value is a proprietary estimate developed by GuruFocus, calculated based on historical multiples, a GuruFocus adjustment factor, and future business performance estimates from Morningstar analysts. In this case, the GF Value suggests that the stock may be overpriced, which could be a contributing factor to the insider's decision to sell.
In conclusion, the recent insider sell by Jason Vlacich, along with the overall insider trading trend at Target Hospitality Corp, may signal a bearish sentiment within the company. However, investors should also consider other factors, such as the company's financial performance and market conditions, before making any investment decisions.
This article first appeared on GuruFocus.