Follow The Money With Insider Buys

According to Investopedia, “The term chief financial officer (CFO) refers to a senior executive responsible for managing the financial actions of a company. The CFO’s duties include tracking cash flow and financial planning as well as analyzing the company’s financial strengths and weaknesses and proposing corrective actions.” (1)

Perhaps, no other position should attract more attention than the CFO for investors who mindfully watch insider buying. Afterall, the Chief Financial Officer is the one that’s most intimate with a company’s financial health.

We like it even more when the CFO has a history of being on the right side of the trade, effectively using his/her understanding for their personal gain.

Azenta, Inc. (AZTA) Chief Financial Officer Lindon Robertson recently purchased 4,350 shares at $57.62 for a total investment of $250,647. It’s not the first time Roberston was bullish on AZTA. His lone other buy was in February 2016, acquiring 20,000 shares at $8.56 for a total outlay of $171,240 when the company was called Brooks Automation.

Just 9 months and 4 days later, the CFO began selling the company that would be renamed Azenta in December 2021. His initial sale was at $15.35, almost 80% higher than what he paid for the stock in February. And then Robertson sold another 17 times though November 2021, all the way up to $119.27, collecting more than $16.4 million along the way. (2)

Azenta is a leading provider of life sciences solutions worldwide, enabling impactful breakthroughs and therapies to market faster. AZTA provides a full suite of reliable cold-chain sample management solutions and genomic services across areas such as drug development, clinical research and advanced cell therapies for the industry’s top pharmaceutical, biotech, academic and healthcare institutions globally.

Shares of the healthcare company have fallen since Roberston’s last sale, cut in half compared to its 52-week high of $124.79. AZTA trades at $56.04 as we type. Wall Street believes Roberston could be on the right side of the trade again with a one-year price target of $81.00. (3)

Analysts believe the company will grow aggressively in 2023. Earnings Per Share (EPS) are forecasted to climb from $0.42 in 2022 to $0.81 next year. Sales are predicted to ride more than 35% to $749.8 million in 2023 from $553.47 million this year.

To hit Wall Street’s one-year price target, Azenta will have to trade at 100-times earnings (P/E) and at 8.1 times sales (P/S). While both numbers are skyscraper high, neither are near Azenta’s recent highs of 150 times earnings and 10.34 times revenue. Still, both are elevated and will likely require Robertson and company to perform better than Wall Street anticipates.

Overall: Azenta, Inc. (AZTA) could have some upside for CFO Roberston and shareholders. However, investors are likely to experience a bumpy ride as the healthcare company will need to trade at elevated levels based on sales and earning valuations.

AZTA is appropriate for the most aggressive investors with a time horizon of at least 18 months.

 

1 – https://www.investopedia.com/terms/c/cfo.asp

2 – https://www.secform4.com/insider-trading/1525267.htm

3 – https://finance.yahoo.com/quote/AZTA?p=AZTA

4 – https://finance.yahoo.com/quote/AZTA/analysis?p=AZTA