SoundThinking Executive Sells Shares Valued at Nearly $2,000

SoundThinking, Inc. executive Nasim Golzadeh, the company’s EVP of Investigative Solutions, recently sold a portion of their shares in the firm. On September 10, Golzadeh sold 166 shares of common stock at prices ranging from $11.92 to $12.01, amounting to nearly $2,000.

This stock sale was executed to fulfill tax withholding obligations associated with the vesting of restricted stock units and to cover any brokerage fees. Following this transaction, Golzadeh retains 68,081 shares in SoundThinking, signaling a continued commitment to the company’s success.

Shareholders seeking detailed information about the transactions can obtain specifics regarding the share sales from Golzadeh, as indicated in the SEC filing. The remaining shares held by Golzadeh demonstrate an ongoing investment in SoundThinking, aligning their interests with those of the shareholders.

The recent sale adds to the understanding of executive trading activities within SoundThinking and provides investors with insight into insider transactions. It is typical for company executives to liquidate shares for personal financial strategies, and such actions are transparently reported to regulatory authorities.

In other developments, SoundThinking announced robust financial results for the second quarter of 2024, with revenues increasing by 22% to reach $27 million compared to the previous year’s quarter. The company’s leading acoustic gunshot detection system, ShotSpotter, has expanded into new markets, including commercial sectors and universities. Notably, new expansions occurred in Uruguay and South Africa, and a collaboration with Rekor for the PlateRanger product is slated to enhance the company’s SafetySmart platform starting in September 2024.

The adjusted EBITDA showed remarkable growth of over 110%, totaling $5.1 million. Despite projecting lower revenues in Q3 due to a surge in professional services during Q2, SoundThinking maintains an optimistic outlook for Q4 and the full year, with revenue guidance set between $104 million and $106 million. Gross profit reached $16.1 million, making up 60% of total revenue.

While the company expects a slight dip in gross margin for Q3, a rebound is anticipated in Q4, coinciding with the expected finalization of a contract renewal proposal with the NYPD. Additionally, SoundThinking noted a 700% year-over-year increase in CaseBuilder subscription-based revenue, and they aim to surpass 100 new ShotSpotter go-live miles within the year.

As investors process the news of Golzadeh’s recent share sale, it is crucial to consider the overall financial health and market performance of SoundThinking. With a market capitalization of $164.52 million, the company’s size is modest within the competitive tech sector. Despite insider selling, the valuation reflects a strong free cash flow yield, hinting at potential shareholder value creation over the long term.

Analysts have adjusted their earnings projections, with some lowering expectations for the upcoming period, suggesting potential challenges or conservative growth outlooks for SoundThinking. This aligns with forecasts indicating a decline in net income this year, which investors should weigh in their assessment of the company’s future earnings potential.

SoundThinking’s revenue growth remains robust, with a 24.16% increase over the past twelve months as of Q2 2024. However, the company is trading at a high EBITDA valuation multiple, and the lack of dividend payments may hint that the market has already factored in elevated growth expectations. For a more comprehensive analysis and insights, additional resources are available to provide a detailed outlook on SoundThinking’s financial and market performance.

As the next earnings date approaches on November 5, 2024, these insights may prove valuable for investors aiming to understand the company’s direction and make informed investment decisions.