On July 10, 2023, Joseph Mansueto, Executive Chairman and 10% Owner of Morningstar Inc (MORN, Financial), sold 22,902 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 673,998 shares and made no purchases.
Who is Joseph Mansueto?
Joseph Mansueto is the Executive Chairman and a 10% owner of Morningstar Inc. He founded the company in 1984 and served as its CEO until 2016. Under his leadership, Morningstar grew from a startup to a leading provider of independent investment research with a market cap of $8.714 billion.
About Morningstar Inc
Morningstar Inc is a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offers an extensive line of products and services for individual investors, financial advisors, asset managers, retirement plan providers and sponsors, and institutional investors. They provide data and research insights on a wide range of investment offerings, including managed investment products, publicly listed companies, private capital markets, and real-time global market data.
Insider Sell Analysis
Over the past year, there have been no insider buys and 69 insider sells for Morningstar Inc. This trend is visualized in the following chart:
The high number of insider sells could be a cause for concern for potential investors. However, it's important to note that insider selling doesn't necessarily indicate a lack of confidence in the company. Executives sell shares for a variety of reasons, including personal financial planning and diversification.
Stock Price and Valuation
On the day of Mansueto's recent sell, Morningstar Inc's shares were trading at $197.82, giving the company a market cap of $8.714 billion. The stock's price-earnings ratio is 525.10, significantly higher than the industry median of 18.52 and the company's historical median.
Despite the high P/E ratio, Morningstar Inc appears to be significantly undervalued based on its GF Value. The price-to-GF-Value ratio is 0.66, as shown in the following chart:
The GF Value is an intrinsic value estimate developed by GuruFocus. It's 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 high number of insider sells over the past year may raise eyebrows, the stock's current valuation suggests that Morningstar Inc could be a good investment opportunity.
