In a recent transaction, Liran Ira, a director at Vita Coco Company, Inc. (NASDAQ:COCO), sold 2,824 shares of common stock. The shares were sold at a weighted average price of $36.022, resulting in a total transaction value of $101,726. This sale was conducted as part of a pre-arranged Rule 10b5-1 trading plan. Following the sale, Ira holds 910,905 shares indirectly through the Ira Liran 2012 Family Trust and 634,426 shares directly. The transaction was filed with the SEC on November 8, 2024.
In other recent news, The Vita Coco Company reported mixed results in its Q3 2024 earnings call. Despite a 4% decrease in net sales to $133 million, primarily due to a 37% drop in private label sales, the company raised its full-year guidance for net sales and adjusted EBITDA. Notably, Vita Coco Coconut Water sales grew by 8%, contributing to an 8% growth in the U.S. and a 19% increase in the UK. The company also reported an increase in net income to $19 million, or $0.32 per diluted share, compared to $15 million, or $0.26 per diluted share, in the same period last year.
These are recent developments, and while gross margins declined to 39% from 41% due to higher ocean freight costs, the company’s cash on hand increased to $157 million, up from $133 million at the end of 2023. The company’s inventory levels also increased by 40% quarter-over-quarter, primarily due to higher unit costs and goods in transit. Looking ahead, Vita Coco projects full-year net sales to be between $505 million to $515 million, and adjusted EBITDA to range from $80 million to $84 million. Despite concerns over high ocean freight costs affecting Q4 margins, the company remains optimistic about its growth potential.
InvestingPro Insights
The recent insider sale by Liran Ira at Vita Coco Company, Inc. (NASDAQ:COCO) comes at a time when the stock is showing strong momentum. According to InvestingPro data, COCO has seen impressive price returns across various timeframes, with a 26.91% gain over the past month and a 39.18% increase over the last three months. This performance has pushed the stock to trade near its 52-week high, with the current price at 97.96% of that peak.
InvestingPro Tips highlight that COCO is trading at a low P/E ratio relative to its near-term earnings growth, suggesting potential value for investors despite the recent price surge. The company’s PEG ratio of 0.6 supports this view, indicating that the stock might be undervalued relative to its growth prospects. Additionally, COCO holds more cash than debt on its balance sheet, which could provide financial flexibility for future growth initiatives.
However, investors should note that the stock’s RSI suggests it may be in overbought territory, which could signal a potential short-term pullback. The company’s P/E ratio of 34.59 and high Price/Book multiple of 8.01 also indicate that the stock is trading at premium valuations, which may warrant caution.
For readers interested in a more comprehensive analysis, InvestingPro offers 15 additional tips for COCO, providing a deeper understanding of the company’s financial health and market position.
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