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Corpay, Inc. (NYSE:CPAY) CEO and Chairman Ronald Clarke has sold 160,000 shares of the company's common stock for a total value of $49.52 million, according to a recent SEC filing. The transaction took place on September 3, with the shares sold at a price of $309.5 each.
The sale is part of Clarke's wealth management planning and represents less than 5% of his total beneficial ownership in the company. This marks Clarke's first sale of Corpay shares since 2017, a period during which he has paid approximately $76 million in cash taxes related to stock-based compensation. Despite this sale, Clarke retains approximately a 5% ownership stake in Corpay.
Clarke's decision to sell a portion of his holdings comes after years of accruing value through the company's stock. Corpay has not provided any specific reason for the sale beyond Clarke's personal financial planning. Investors often monitor insider transactions as they can provide insights into executives' perspectives on the company's current valuation and future prospects.
The transaction details, including the number of shares sold and the price per share, were disclosed in compliance with SEC regulations. Following the sale, Clarke continues to hold over 2 million shares of Corpay directly, ensuring his interests remain closely aligned with those of the company and its shareholders.
In other recent news, Corpay reported Q2 earnings and revenue that surpassed analyst estimates. The company posted an adjusted earnings per share of $4.55, slightly outperforming the estimated $4.51, and revenue was reported at $975.7 million, marginally above the consensus of $973.6 million. However, Corpay's Q3 guidance fell below analysts' estimates, expecting an adjusted EPS of $4.90-$5.00, which is lower than the consensus estimate of $5.18. The projected Q3 revenue also fell short, with a guidance of $1.015-1.035 billion against analysts' projection of $1.049 billion. In terms of corporate developments, Corpay completed its acquisition of Paymerang, which is anticipated to contribute $25-35 million in revenue for the remainder of 2024. Wolfe Research recently adjusted its rating on Corpay's stock from Underperform to Peer Perform, recognizing the company's sustained growth prospects and solid capital position. Despite these positive indicators, the firm also noted potential challenges such as increased competition in the B2B payments sector. These are recent developments in Corpay's operations.
InvestingPro Insights
As Corpay's CEO Ronald Clarke adjusts his personal investment in the company, investors and analysts are closely watching Corpay's financial metrics and market performance. According to InvestingPro data, Corpay has a robust market capitalization of $21.67 billion, with a Price/Earnings (P/E) ratio of 22.21. This valuation comes as the company exhibits a Price/Book ratio of 7.89, indicating a premium compared to the book value of its assets for the last twelve months as of Q2 2024.
Moreover, Corpay has demonstrated solid revenue growth, with a 5.32% increase over the last twelve months leading up to Q2 2024. This growth is complemented by a strong gross profit margin of 78.36%, underscoring the company's ability to maintain profitability. Investors may also find encouragement in the company's price performance, with a 14.36% return over the last month and an impressive 21.89% return over the last three months.
Two InvestingPro Tips that may be of interest to investors in the context of Clarke's share sale and the company's current financial standing are:
- Corpay's management has been actively engaging in share buybacks, a move that can signal confidence in the company's value and prospects.
- Analysts have revised their earnings expectations downwards for the upcoming period, a factor that could influence the company's future share price dynamics.
While Clarke's share sale is significant, the InvestingPro Tips suggest a mixed outlook with both positive actions by management and caution from analysts. For a deeper dive into Corpay's financials and additional tips, investors can explore the full suite of insights available at InvestingPro, which includes numerous tips to help inform investment decisions.
For those interested in further analysis, there are 9 additional tips listed on InvestingPro specific to Corpay, providing a comprehensive view of the company's financial health and market position.
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