Is It Worthwhile For Investors To Follow These Insider Trades On Mohawk Industries Inc. (MHK)?

Mohawk Industries Inc. (NYSE:MHK) finished Friday with an addition of $0.27 to close at $192.12, an upside of 0.14 percent. An average of 376,080 shares of common stock have been traded in the last five days. There was a gain of $8.09 in the past week, and it reached a new high 45 times over the past 12 months. The last 20 days have seen an average of 458,220 shares traded, while the 50-day average volume stands at 430,658.

MHK stock has increased by 3.69% in the last month. The company shares reached their 1-month lowest point of $174.68 on 10/06/21. With the stock rallying to its 52-week high on 05/10/21, shares of the company touched a low of $90.98 and a high of $231.80 in 52 weeks. It has reached a new high 32 times so far this year and achieved 36.30% or $51.17 in price. In spite of this, the price is down -17.12% from the 52-week high.


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Insider Transactions

81 days have passed since Mohawk Industries Inc. (MHK) last reported insider trading activity. Brunk James, who is CFO – VP FINANCE, most recently acquired $950 shares at $195.00 per share on Aug 03. In this transaction, the insider spent $185,250. President-Flooring ROW, Thiers Bernard, disposed of 5,000 shares at a price of $222.00 on May 05. The insider now owns more than $1,110,000 worth of shares. Prior to that, VP BUSINESS STRATEGY Patton Rodney David went on to Sale 506 shares at $220.07 each on May 03. An amount of $111,356 was transacted.

Valuation Metrics

Mohawk Industries Inc. (MHK) has a trailing price-to-earnings (P/E) ratio of 13.23, which compares with the 16.20 for the broader industry and 32.04 for the sector. In the last five years, Mohawk Industries Inc.’s PE ratio has ranged between 27.10 and 5.701. The stock’s beta is 1.54. Other valuation ratios to consider include the trailing price-to-sales (P/S) ratio at 1.24, the price-to-book (PB) ratio at 1.52, and the price-to-cash flow ratio at 11.67.

The quick ratio of Mohawk Industries Inc. for the three months ended June 29 was 1.20, and the current ratio was 1.90, indicating that the company is able to meet its debt obligations. Further, the company has a long term debt to equity ratio of 0.20 and a total debt to equity ratio of 0.31 for the quarter ending June 29. Mohawk Industries Inc.’s EBITDA margin for the year ending June 29 is 16.27%, while its operating margin for the same period stands at 11.70%. Its gross profit as reported stood at $2.43 billion compared to revenue of $9.55 billion.

For investors, determining the potential profitability of the investment also depends on the performance of the company’s management. In the past 12 months, Mohawk Industries Inc.’s return on assets was 7.20%. For the broader industry, ROE averaged 2.17 over the past year.

Earnings Surprise

For the three-month period that ended June 29, Mohawk Industries Inc. had $662.36 million in cash and short-term investments compared to $1.72 billion in total debt. In the quarter under review, the net income was up than the previous quarter. The company posted a net income of $336.29 million in the quarter, while revenues of $236.81 million were grew 114.35%. The analyst consensus anticipated Mohawk Industries Inc.’s latest quarter earnings to come in at $3.67 per share, but it turned out to be $4.45, a 21.30% surprise. For the quarter, EBITDA amounted to $552.89 million. Shareholders own equity worth $69.03 million.

Technical Picture

From a technical analysis perspective, let’s take a brief look at Mohawk Industries Inc. (MHK) price momentum. RSI 9-day as of the close on 22 October was 69.33%, suggesting the stock is Neutral, with historical volatility in this time frame at 19.79%.

As of today, MHK’s price is $189.18 +4.40% or $8.09 from its 5-day moving average. MHK is currently trading +4.19% higher than its 20-day SMA and -5.25% lower than its 100-day SMA. However, the stock’s current price level is -8.43% below the SMA50 and +33.13% above the SMA200.

The stochastic %K and %D were 92.11% and 88.94%, respectively, and the average true range (ATR) was 4.60. With the 14-day stochastic at 89.02% and the average true range at 4.74, the RSI (14) stands at 60.89%. The stock has reached 4.90 on the 9-day MACD Oscillator while the 14-day reading was at 7.37.

Analyst Ratings

Wells Fargo launched coverage on Mohawk Industries Inc. (NYSE: MHK) in its analyst report released on July 16, 2021. The firm assigned the stock a an Equal weight rating. The consensus rating for Mohawk Industries Inc. (MHK) among analysts is Overweight. According to current brokerage recommendations, 1 brokerage firm advise that investors sell MHK, while 6 suggest investors hold. There are 0 analysts who rate the stock as underweight. The stock is rated overweight by 0 analysts, while 8 others rate it as a “buy”.

What is MHK’s price target for the next 12 months?

Analysts predict a range of price targets between $167.00 and $270.00, with a median target of $236.00. Taking a look at these predictions, the average price target given by analysts for Mohawk Industries Inc. (MHK) stock is $227.92.

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