Matthew Craig Miller, a director at Confluent, Inc. (NASDAQ:CFLT), recently reported significant sales of the company’s stock. According to a filing with the Securities and Exchange Commission, Miller sold a total of 1,084,259 shares of Class A Common Stock on November 13, 2024. The sales were executed at a weighted average price of $28.88 per share, amounting to approximately $30.8 million. An additional 17,015 shares were sold at a weighted average price of $30.01, bringing in around $510,548.
The transactions were carried out through entities associated with Miller, including Sequoia Capital Fund Parallel, LLC and Sequoia Capital Fund, LP. Following these sales, Miller, through the involved entities, no longer holds shares of the Class A Common Stock in these specific accounts. The sales were part of a trading plan established under Rule 10b5-1, which allows insiders to set up a predetermined plan for selling stocks.
In other recent news, Confluent, Inc. saw a strong third quarter in 2024, with significant growth in subscription and cloud revenues. The company’s subscription revenue rose by 27% to $240 million, while total revenue saw a 25% increase to $250 million. Specifically, Confluent Cloud revenue surged by 42% to $130 million, accounting for over half of the total revenue.
The company also reported that it now serves all top 10 U.S. banks, with average annual recurring revenue exceeding $5 million. Record gross margins were reported, with subscription gross margin at 82.2% and free cash flow margin at 3.7%.
In other developments, Confluent announced the retirement of its Chief Technology Officer, Chad Verbowski, who will continue to serve as an advisor until February 2025. The company is actively seeking a replacement for the CTO position but has not yet announced a successor.
Looking ahead, Confluent projects Q4 2024 subscription revenue to be between $245 million and $246 million, and full-year subscription revenue to range from $916.5 million to $917.5 million, reflecting a 26% growth. These are the recent developments with Confluent, Inc.
InvestingPro Insights
While Matthew Craig Miller’s recent stock sales might raise eyebrows, it’s important to consider Confluent’s broader financial picture. According to InvestingPro data, Confluent boasts a market capitalization of $8.91 billion, reflecting its significant presence in the data infrastructure space. The company’s revenue growth remains robust, with a 25.01% increase over the last twelve months as of Q3 2024, reaching $915.61 million.
Despite the insider selling, InvestingPro Tips highlight some positive aspects of Confluent’s financial health. The company holds more cash than debt on its balance sheet, indicating a strong liquidity position. This is further supported by the fact that Confluent’s liquid assets exceed its short-term obligations, providing financial flexibility.
However, investors should note that Confluent is currently trading at a high revenue valuation multiple and a high Price / Book ratio of 10.01. This suggests that the market has high expectations for the company’s future performance. Interestingly, while Confluent was not profitable over the last twelve months, analysts predict the company will turn profitable this year, which could explain the optimistic valuation.
For those seeking a more comprehensive analysis, InvestingPro offers additional insights with 7 more tips available for Confluent. These tips could provide valuable context for understanding the recent insider selling and the company’s future prospects.
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