On September 14, 2023, Chief Information Officer Thomas Frank sold 40,739 shares of Interactive Brokers Group Inc (IBKR, Financial). This move is part of a series of transactions made by the insider over the past year, which have seen a total of 384,109 shares sold and no shares purchased.
Thomas Frank is a key figure at Interactive Brokers Group Inc, a company that operates as an automated electronic broker and market maker in approximately 125 electronic exchanges and marketplaces worldwide. The company specializes in executing and clearing trades in securities, futures, foreign exchange instruments, bonds, and mutual funds. The company also offers margin lending, and cash management services.
The insider's recent sell-off is part of a broader trend within the company. Over the past year, there have been 42 insider sells and no insider buys. This trend is illustrated in the following image:
On the day of the insider's recent sell, shares of Interactive Brokers Group Inc were trading at $92.5 each, giving the company a market cap of $9.81 billion. The price-earnings ratio stood at 18.72, slightly higher than the industry median of 18.49 but lower than the company’s historical median price-earnings ratio.
Despite the insider's sell-off, the stock appears to be modestly undervalued. With a price of $92.5 and a GuruFocus Value of $105.84, Interactive Brokers Group Inc has a price-to-GF-Value ratio of 0.87. The GF Value is an intrinsic value estimate developed by GuruFocus, calculated based on historical multiples, a GuruFocus adjustment factor, and future estimates of business performance from Morningstar analysts. The GF Value is illustrated in the following image:
The insider's sell-off, coupled with the stock's modest undervaluation, suggests that potential investors should keep a close eye on Interactive Brokers Group Inc. While the insider's actions may raise some concerns, the company's solid fundamentals and the stock's undervaluation provide a compelling investment case.
As always, potential investors should conduct their own due diligence and consider their risk tolerance before making investment decisions.
