In a recent transaction on June 6, a significant stockholder of SPAR Group, Inc. (NASDAQ:SGRP), Robert G. Brown, sold a number of shares in the company. The total value of the shares sold amounted to over $32,000, with the prices per share ranging between $2.1 and $2.13.
The series of transactions involved the sale of 9,123 shares at $2.1 each, 3,630 shares at $2.13 each, and 2,448 shares at $2.11 each. Following these sales, Brown still holds a substantial number of shares in the company. Notably, this includes shares beneficially owned in any defined benefit plan that pays him a pension.
Additionally, Brown has indirect ownership through Innovative Global Technologies LLC and SPAR Business Services, Inc., where he serves in managerial and controlling positions. According to the footnotes in the filing, Brown is a Manager of Innovative Global Technologies LLC and the controlling officer/director, as well as a significant shareholder of SPAR Business Services, Inc.
The transactions were disclosed in a Form 4 filing with the Securities and Exchange Commission, dated June 10. SPAR Group, Inc., based in Auburn Hills, Michigan, operates in the business services sector, providing a range of services including merchandising and marketing.
Investors often monitor insider sales and purchases as they can provide insights into the company's financial health and future prospects. However, it's important to note that there can be many reasons for an insider to sell shares, and such transactions do not necessarily indicate a negative outlook for the company.
In other recent news, SPAR Group Inc. has announced its intent to be acquired by Highwire Capital in a cash transaction valued at $58 million. The proposed merger, which is still under negotiation, was unanimously approved by SPAR's Board and a Special Committee of Independent Directors. This move followed an extensive review of strategic alternatives to maximize shareholder value.
Simultaneously, SPAR Group reported robust Q1 2024 results, with a 6.7% increase in consolidated revenue, largely driven by the decision to exit its South Africa business. This strategic move resulted in a $7.2 million gain and a net income of $6.6 million. The earnings per share for the quarter were $0.28, and the company's US and Canada operations saw significant growth, particularly in the US remodel business which increased by 98%.
Financially, SPAR Group is in a strong position with a total worldwide liquidity of $21 million and a cash position of $16.6 million. The company has also secured over $35 million in new business, including a substantial multi-year contract worth over $12 million annually. In terms of future developments, SPAR Group is focusing on the US and Canada markets, pursuing organic growth, considering potential acquisitions, and enhancing shareholder value.
InvestingPro Insights
Following the recent insider transactions by Robert G. Brown at SPAR Group, Inc. (NASDAQ:SGRP), market participants may be keen to understand the broader financial context of the company. According to InvestingPro data, SPAR Group, Inc. maintains a market capitalization of $57.79 million and is trading at a price-to-earnings (P/E) ratio of 5.78, which is relatively low compared to industry standards. This could suggest that the company's shares are undervalued, especially considering the adjusted P/E ratio for the last twelve months as of Q1 2024 stands at 10.99.
Despite a modest revenue growth of 0.15% in the last twelve months as of Q1 2024, SPAR Group has demonstrated a notable quarterly revenue growth of 6.7% in Q1 2024. This indicates a potential rebound or positive business developments during the recent quarter. Furthermore, the company's gross profit margin remains at 20.18%, which may reflect on its pricing power and operational efficiency.
Investors looking at recent performance will find that SPAR Group has experienced a strong return over the last three months, with a price total return of 110.68%. Additionally, the company has delivered a high return over the last year, with a price total return of 73.6%. An InvestingPro Tip highlights that the stock has had a large price uptick over the last six months, reinforcing the positive momentum observed in the stock's performance.
For those interested in further insights and additional tips, there are 12 more InvestingPro Tips available for SPAR Group, Inc., which can be accessed by visiting: https://www.investing.com/pro/SGRP. These tips include analysis on sales projections, profitability, and debt levels, among others. To gain access to these valuable tips, use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription at InvestingPro.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.