HLMN

Hillman Solutions ($HLMN) CFO Buys $992,600 Worth of Shares Amid Stock Plunge, Reversing Insider Selling Trend

05/05/2025 12:32

Hillman Solutions Corp ($HLMN) Chief Financial Officer Robert Kraft has captured investor attention by purchasing approximately $992,600 worth of company stock amid a sharp price decline. According to a May 1 filing, Kraft acquired 140,000 shares at an average price of $7.09 per share. This purchase comes as $HLMN stock has experienced a significant downturn since early April. Hillman Solutions shares, which traded around $9 in late March 2025, collapsed below $8 in early April and have fallen approximately 20% over the past month, closing at $7.14 on May 2. The stock has declined about 28.6% year-to-date and has plummeted more than 38% from its November high of $11.54. Founded in 1964, Hillman Solutions Corp. is a provider of hardware-related products and merchandising services throughout North America and Latin America. Headquartered in Forest Park, Ohio, the company supplies fasteners, tools, safety products, and various hardware items marketed under multiple brand names. With a market capitalization of approximately $1.56 billion, it falls into the small-cap category. Notably, Kraft's substantial purchase runs counter to recent insider trading patterns. Disclosure documents reveal that most insider transactions over the past 12 months have been sales. In February 2025, President Scott Ride sold approximately 12,359 shares at $10.06. In December 2024, Director Philip Woodlief divested about 19,779 shares at $11.18. Additionally, in November 2024, President Ride executed a larger sale of 72,523 shares at $10.66. Against this backdrop, CFO Kraft's significant acquisition could be interpreted as a strong signal of management's confidence in the company's stock. Particularly, his decision to invest personal funds after a considerable price decline suggests that insiders may believe the current stock price fails to reflect the company's intrinsic value. Hillman Solutions' recent performance presents mixed signals. For the first quarter of 2025 (ended March 31), the company reported adjusted earnings per share (EPS) of $0.10 and revenue of $359.34 million. Revenue increased by 2.6% year-over-year, slightly exceeding analyst expectations of $357.33 million. However, overall profitability remains lackluster, with an annual profit margin of just 1.24%. Examining the financial condition, Hillman Solutions maintains adequate liquidity but carries concerning debt levels. The company maintains a current ratio of 2.46, indicating solid short-term debt-paying ability, but total debt stands at $811.3 million, substantially higher than its total cash of $36.31 million. The debt ratio of approximately 68.64% could make the company vulnerable to changes in the interest rate environment. In August 2024, Hillman Solutions acquired Intex DIY, expanding its position in the cleaning products category, though financial terms were not disclosed. This acquisition appears to be part of the company's efforts to diversify its product line and expand market share. Currently, analysts maintain an average rating of 'buy' with price targets ranging between $12 and $13, approximately 70-80% above the current share price. This significant discrepancy supports the view that the market may be temporarily undervaluing Hillman Solutions. However, given the recent sharp stock decline, analysts might soon revise their price targets downward. The next earnings announcement is expected in early August, with analysts projecting quarterly EPS of $0.17 and revenue of $394.6 million. While the company's low profitability and high debt levels remain concerns, the CFO's substantial stock purchase suggests management's confidence in the company's long-term outlook. Investors should note that Kraft's purchase represents a significant departure from past insider trading patterns while closely monitoring Hillman Solutions' performance improvement and debt management capabilities. While the current low share price might offer an attractive entry point, without fundamental improvements in profitability, stock recovery could be limited.

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