On September 21, 2023, President William Jordan of Designer Brands Inc (DBI, Financial) sold 150,000 shares of the company's stock. This move is part of a trend for the insider, who over the past year has sold a total of 150,000 shares and purchased none.
Designer Brands Inc is a major player in the retail industry, specializing in the design, production, and retail of footwear and accessories. The company operates through three segments: The U.S. Retail segment, the Canada Retail segment, and the Brand Portfolio segment. The U.S. Retail segment includes DSW stores and dsw.com, offering a wide assortment of brand name and designer dress, casual and athletic footwear, and accessories. The Canada Retail segment includes The Shoe Company, Shoe Warehouse, and DSW stores and related e-commerce, offering a wide assortment of brand name and designer dress, casual and athletic footwear, and accessories. The Brand Portfolio segment includes design, production, sourcing, and marketing of footwear for the company's proprietary and licensed brands.
The insider's recent sell has raised some eyebrows in the financial community, as it comes amidst a period of relative stability for the company's stock. Over the past year, there have been no insider buys and 12 insider sells for Designer Brands Inc. This trend is illustrated in the following chart:
On the day of the insider's recent sell, shares of Designer Brands Inc were trading for $12.26 apiece, giving the company a market cap of $735.376 million. This is significantly lower than the industry median, as the company's price-earnings ratio of 6.20 is lower than the industry median of 18.13 and lower than the company’s historical median price-earnings ratio.
According to the GuruFocus Value, which is an intrinsic value estimate developed by GuruFocus based on historical multiples, a GuruFocus adjustment factor, and future estimates of business performance, Designer Brands Inc is currently modestly undervalued. With a price of $12.26 and a GuruFocus Value of $15.66, the stock has a price-to-GF-Value ratio of 0.78. This suggests that there may be potential for growth in the company's stock, despite the insider's recent sell.
In conclusion, while the insider's recent sell of 150,000 shares of Designer Brands Inc may raise some questions, the company's strong fundamentals and potential for growth suggest that this may be a strategic move rather than a cause for concern. As always, investors are advised to do their own research and consider the broader market trends before making any investment decisions.
