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Entities related to The Carlyle Group (NASDAQ:CG) Inc. have sold a significant amount of shares in QuidelOrtho Corp (NASDAQ:QDEL), a leading provider of in vitro diagnostic products. The transactions totaled over $2.5 million, with individual sales prices ranging from $30.0706 to $31.2852.
The sales, which took place on July 8 and July 9, 2024, involved multiple entities that are part of The Carlyle Group's intricate ownership structure. These entities include Carlyle Holdings II GP L.L.C., Carlyle Holdings II L.L.C., CG Subsidiary Holdings L.L.C., TC Group Cayman Investment Holdings L.P., and several others, all of which may be deemed to share beneficial ownership of the securities held.
On July 8, a total of 57,007 shares of QuidelOrtho's common stock were sold at a weighted average price of $30.3458, while another 2,966 shares were sold at an average of $31.2852. The following day, 23,781 shares were sold at a weighted average price of $30.0706. These transactions were executed in accordance with a Rule 10b5-1 trading plan adopted on May 12, 2024, which allows insiders to set up a predetermined plan to sell stocks at a specific time or price, providing them with an affirmative defense against charges of insider trading.
The entities involved have emphasized that they disclaim beneficial ownership of the reported securities, which are held of record by Carlyle Partners VI Cayman Holdings, L.P. This reflects the complexity of the ownership and management structure, where multiple layers of entities have interests in the reported holdings.
Investors and market watchers often pay close attention to insider transactions as they can provide valuable insights into a company's financial health and future prospects. The sale of such a sizeable amount of stock by entities related to a major investment firm like The Carlyle Group is noteworthy and may be of interest to current and potential shareholders of QuidelOrtho Corp.
In other recent news, QuidelOrtho's Q1 2024 earnings call revealed mixed results, as the diagnostics company reported a decrease in total revenue to $711 million, primarily due to a decline in COVID-19 related sales. Despite this, the company experienced growth in other areas, excluding COVID-19 products. The new President and CEO, Brian Blaser, is set to enhance customer satisfaction, profitability, and market competitiveness. The company is also embarking on a cost reduction phase that includes significant headcount reductions, aiming to save around $100 million annually.
QuidelOrtho has suspended its financial guidance, providing the new CEO an opportunity to reassess the business and strategize for the rest of the year. Notably, the company's Point-of-Care and Molecular Diagnostics segments showed strong growth, excluding COVID-19 revenue. However, the company also reported a significant noncash goodwill impairment charge of $1.7 billion for the North America reporting unit.
These are recent developments that investors should monitor closely. The company's strategic moves, including the appointment of a new CEO and cost reduction initiatives, are aimed at positioning QuidelOrtho for sustainable growth. As the company continues to adjust its focus from pandemic-related products to other areas of diagnostics, investors and stakeholders are advised to await further updates as the new leadership undertakes a thorough business review.
InvestingPro Insights
QuidelOrtho Corp (NASDAQ:QDEL) has recently been under the investor microscope due to significant insider transactions. As entities related to The Carlyle Group Inc. divested shares worth over $2.5 million, market participants are keen to understand the company's current financial standing and future outlook. InvestingPro provides a deeper dive into QuidelOrtho's metrics and performance indicators that could shed light on these recent developments.
InvestingPro data reveals a market capitalization of approximately $2.01 billion for QuidelOrtho, indicating its size within the in vitro diagnostic products sector. Despite challenging market conditions, the company's gross profit margin remains robust at 48.13% for the last twelve months as of Q1 2024. This suggests that QuidelOrtho is maintaining its profitability in terms of revenue versus cost of goods sold. However, the company's revenue has seen a decline of 7.95% during the same period, reflecting potential headwinds in sales or market demand.
An InvestingPro Tip points out that QuidelOrtho operates with a significant debt burden, which investors should consider when evaluating the company's financial leverage and risk profile. Additionally, the company's stock has fared poorly over the last month, with a price total return of -27.02%, and is trading near its 52-week low, which could be a concern for shareholders.
For those looking to delve further into QuidelOrtho's financials and stock performance, InvestingPro offers additional insights. There are 10 more InvestingPro Tips available for QuidelOrtho at https://www.investing.com/pro/QDEL, which can provide a more comprehensive analysis of the company's position and prospects. Interested readers can use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription, potentially unlocking valuable investment intelligence.
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