Griffon Corp Executive Sells Over $2.4 Million in Company Stock

In recent trading activities, Seth L. Kaplan, Senior Vice President, General Counsel, and Secretary of Griffon Corporation, sold a considerable portion of his holdings in the company. Over two days, Kaplan sold a total of 35,274 shares of common stock at a consistent price of $70.00 per share, resulting in total sales amounting to $2,469,180.

These transactions occurred on September 18 and September 19 and were disclosed in a Form 4 filing with the Securities and Exchange Commission. On the first day, Kaplan sold 4,844 shares, and on the second, an additional 30,430 shares. After these sales, Kaplan’s direct holdings in Griffon Corporation were reduced to 168,141 shares.

Additionally, it is noted that Kaplan possesses an indirect ownership of 4,555 shares through the Employee Stock Ownership Plan (ESOP), as highlighted in a footnote of the filing, indicating changes since his last ownership report.

Insider transactions are often closely examined by investors as they can provide insights into executives’ perceptions of the company’s stock value. The recent sales by Kaplan, a prominent executive, may draw additional market interest towards Griffon Corporation.

Griffon Corporation, publicly traded on the New York Stock Exchange, specializes in manufacturing metal doors, sash, frames, molding, and trim. Its stock performance and insider activities are closely monitored by investors keen on understanding the company’s financial condition and future outlook.

In other news, The Toro Company has divested its Pope Products business to The AMES Company, a subsidiary of Griffon Corporation. This strategic decision aims to streamline Toro’s portfolio and concentrate on areas with greater growth potential. The transaction is not anticipated to have a significant impact on Toro’s fiscal 2024 results, as the company had already accounted for it in previous forecasts.

At the same time, Griffon Corporation has been making considerable progress, not only with this acquisition—which is expected to enhance annualized revenue by about $25 million—but also in its financial performance. The company reported a strong start to fiscal 2024, exceeding market expectations with impressive revenue and EBITDA results in the Home and Building Products segment. Griffon has also raised its full-year revenue guidance to $2.65 billion, with an anticipated increase of $30 million in segment adjusted EBITDA, now forecasted at $555 million.

Furthermore, Griffon Corporation has successfully repriced its Secured Term Loan B facility, maturing in January 2029. This repricing, managed by Bank of America, N.A., is projected to save the company approximately $1.8 million in annual cash interest expenses, reflecting Griffon’s solid financial standing and operational efficiency. These developments mark significant advancements for both companies.

Amid the insider trading events at Griffon Corporation, investors may be keen to evaluate the broader financial context of the company. With a market capitalization around $3.37 billion, Griffon’s financial metrics outline its current valuation and performance.

The company’s Price/Earnings (P/E) ratio is recorded at 17.84, aligning with the industry average and suggesting a fair valuation in relation to its earnings. However, when adjusting for the last twelve months as of Q3 2024, the adjusted P/E ratio slightly drops to 15.13, indicating a potential undervaluation based on expected earnings growth. The company also holds an attractive PEG ratio of 0.12, suggesting a favorable growth trajectory relative to its earnings growth rate.

Griffon’s revenue over the last twelve months as of Q3 2024 was $2.605 billion, although it experienced a minor decline of 5.36% in revenue growth. Despite this, the company maintains a robust gross profit margin of 39.79%, reflecting efficient cost management and the ability to preserve a significant fraction of its revenue as gross profit.

Two noteworthy insights regarding Griffon Corporation include the management’s aggressive share buyback strategy and the fact that the company has increased its dividend for four consecutive years. This demonstrates the leadership’s confidence in the company’s financial stability and its commitment to returning value to shareholders. Additionally, the company has maintained dividend payments for 14 consecutive years, a testament to its financial resilience and consistent performance.

These financial metrics and insights may aid investors in forming a comprehensive perspective on Griffon Corporation’s valuation and performance as they assess the implications of insider transactions and consider the company’s prospects.