In a recent transaction, Charles K. Cohn, the Chief Executive Officer of Nerdy Inc. (NYSE:NRDY), acquired a significant amount of the company's Class A Common Stock. On November 14, Cohn purchased 208,726 shares at an average price of $0.87 per share, amounting to a total transaction value of $181,591. This purchase was made through the Cohn Family Trust U/A/D 3/16/2017, increasing Cohn's indirect ownership to 21,157,650 shares following the transaction.
Additionally, Cohn engaged in a derivative transaction involving Class B Common Stock, acquiring 1,000,000 shares at a price of $1.00 per share, held by Rarefied Air Capital LLC. This transaction reflects a strategic move by Cohn to bolster his stake in Nerdy Inc., a company known for its educational services.
In other recent news, Nerdy, Inc. reported mixed results for its third quarter of 2024. The company's revenue declined by 7% year-over-year, totaling $37.5 million, despite an increase in active members. Nerdy's Consumer Learning Memberships generated $31.4 million, accounting for 84% of total revenue, while institutional business revenue declined by 3% year-over-year to $5.4 million. However, 32% of paid contracts and 22% of total bookings are now coming from school districts transitioning from free to paid services, indicating a promising shift towards institutional growth. Canaccord Genuity recently adjusted its outlook on Nerdy, reducing the price target while maintaining a Hold rating, anticipating gradual improvement by fiscal year 2026. Looking ahead, Nerdy expects Q4 revenue to range from $44 million to $47 million, with full-year revenue estimates between $186 million and $189 million. These recent developments reflect the company's commitment to overcoming market challenges and focusing on sustainable growth.
InvestingPro Insights
The recent insider buying by Nerdy Inc.'s CEO Charles K. Cohn aligns with several key insights from InvestingPro. Despite the company's stock price falling significantly over the last year, with a 60.32% decline in the past 12 months, Cohn's purchase suggests confidence in the company's future prospects.
InvestingPro data shows that Nerdy Inc. has a market capitalization of $172.42 million, with impressive gross profit margins of 68.78% for the last twelve months as of Q3 2023. This aligns with one of the InvestingPro Tips highlighting the company's "impressive gross profit margins," which could be a factor in Cohn's decision to increase his stake.
Another relevant InvestingPro Tip indicates that Nerdy "holds more cash than debt on its balance sheet," potentially providing the company with financial flexibility during challenging times. This strong liquidity position is further supported by the tip that "liquid assets exceed short term obligations," which may have influenced Cohn's confidence in the company's financial stability.
It's worth noting that while the stock has experienced significant volatility, with a 12.38% return over the last week contrasting with a 50.98% decline over the past six months, the CEO's substantial purchase could signal a belief in the company's undervaluation or future growth potential.
For investors seeking a more comprehensive analysis, InvestingPro offers 12 additional tips for Nerdy Inc., providing a deeper understanding of the company's financial health and market position.
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