Texas Roadhouse , Inc. (NASDAQ:TXRH), a renowned player in the retail-eating places sector, recently witnessed a significant transaction by one of its top executives. The company's Chief Technology Officer, Hernan E. Mujica, sold 3,000 shares of common stock at an average price of $168.60, resulting in a total sale value of approximately $505,800. The transaction took place on May 20, 2024, and was publicly disclosed in a filing with the Securities and Exchange Commission.
The shares were sold within a narrow price range of $168.50 to $168.70. While the exact number of shares sold at each price within the range was not specified in the filing, the weighted average sale price was reported to be $168.60. Following the sale, Mujica retains ownership of 17,842 shares of Texas Roadhouse common stock.
In addition to the sale of common stock, the filing also indicated that Mujica holds restricted stock units (RSUs) that represent a conditional right to receive an additional 4,200 shares of the company's common stock. These RSUs are set to vest on January 8, 2025, provided that Mujica continues his service with the company until that date.
The transaction was executed under the power of attorney by Sean Renfroe, as indicated by the signature on the SEC filing. Investors and market watchers often pay close attention to the trading activities of corporate insiders, as these can provide insights into the executives' perspectives on the company's current valuation and future prospects.
Texas Roadhouse, headquartered in Louisville, Kentucky, operates under the fiscal year ending December 31. The recent trading activity involving its shares is part of the routine financial disclosures required by corporate insiders.
InvestingPro Insights
As investors digest the news of Texas Roadhouse's CTO selling a portion of his holdings, it's worth examining the company's financial health and market performance through various lenses. Texas Roadhouse (NASDAQ:TXRH) has demonstrated a robust track record by raising its dividend for 3 consecutive years, signaling confidence in its financial stability and commitment to shareholder returns. Moreover, the company has maintained dividend payments for 14 consecutive years, which is a testament to its consistency and reliability in rewarding investors.
On the valuation front, Texas Roadhouse is currently trading at a high earnings multiple, with a P/E ratio of 33.76, which closely aligns with the adjusted P/E ratio for the last twelve months as of Q1 2024 at 33.75. This suggests that the market has high expectations for the company's future earnings. Additionally, the company's Price / Book ratio stands at 9.28, indicating that investors are willing to pay a premium for the company's net assets.
While the company's gross profit margins could be stronger, sitting at 16.88%, Texas Roadhouse has achieved a revenue growth of 13.73% over the last twelve months leading up to Q1 2024. This growth is a positive indicator of the company's ability to expand its business and increase sales. Furthermore, the company has a fair value estimate of 175 USD according to analyst targets, which is higher than the current price of 167.79 USD, suggesting potential upside for investors.
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