On June 30, 2023, Joseph Mansueto, Executive Chairman and 10% Owner of Morningstar Inc (MORN, Financial), sold 25,300 shares of the company. This move is part of a series of transactions Mansueto has made over the past year, during which he sold a total of 644,286 shares and made no purchases.
Joseph Mansueto is a prominent figure in the financial industry, best known as the founder of Morningstar Inc. He served as the company's CEO from its inception in 1984 until 2016, and currently holds the position of Executive Chairman. Under his leadership, Morningstar has grown into a leading provider of independent investment research, with a market cap of $8.365 billion.
Morningstar Inc provides an array of investment-management services including index, equity, and credit research. It offers internet, software, and print-based products for individual investors, financial advisors, and institutional clients. It also supplies asset-management services to advisors, institutions, and retirement-plan participants.
The insider transaction history for Morningstar Inc shows a clear trend of selling over the past year, with 67 insider sells and no insider buys. This could be a signal to investors about the company's future prospects, as insiders often sell their shares for reasons other than cash needs.
Despite the insider selling trend, Morningstar Inc's stock price remains robust. On the day of Mansueto’s recent sale, shares were trading at $192.64, giving the company a market cap of $8.365 billion. The price-earnings ratio stands at a high 504.13, significantly above the industry median of 18.01 and the company’s historical median price-earnings ratio.
However, according to the GuruFocus Value, the stock appears to be significantly undervalued. With a price of $192.64 and a GuruFocus Value of $298.16, Morningstar Inc has a price-to-GF-Value ratio of 0.65.
The GF Value is an intrinsic value estimate developed by GuruFocus. It is calculated based on historical multiples that the stock has traded at, a GuruFocus adjustment factor based on the company’s past returns and growth, and future estimates of business performance from Morningstar analysts.
In conclusion, while the insider selling trend might raise some eyebrows, the valuation metrics suggest that Morningstar Inc's stock is currently undervalued. Investors should keep a close eye on the company's performance and any future insider transactions.
