Joseph Stilwell, a director at Kingsway Financial Services Inc. (NYSE:KFS), reported the sale of shares totaling $95,500, according to a recent SEC filing. The transactions occurred on November 6, 2024, under a pre-established trading plan. Stilwell Activist Investments, L.P. sold 8,664 shares, and Stilwell Activist Fund, L.P. sold 1,336 shares, both at $9.55 per share.
Following these sales, Stilwell's direct and indirect holdings in Kingsway Financial have been adjusted. The transactions were conducted as part of a Rule 10b5-1 trading plan, which allows insiders to set up a predetermined plan for trading stocks to avoid potential conflicts of interest.
In other recent news, Kingsway Financial Services expanded its portfolio through the acquisition of Image Solutions LLC, a North Carolina-based IT managed services provider. The deal was valued at $19.5 million, funded by available cash and $7.75 million in debt financing. The acquisition is expected to add $9.8 million in annual unaudited revenue and $3.1 million in annual unaudited adjusted EBITDA to Kingsway's financials, with the company predicting an immediate increase in its earnings.
The purchase was structured as a buyout of all issued and outstanding membership interests in Image Solutions. The financing for the acquisition was provided by Avidbank, while Holland & Knight LLP served as legal counsel to Kingsway. The acquisition was highlighted as a strategic fit within Kingsway's Xcelerator portfolio by J.T. Fitzgerald, President and CEO of Kingsway.
Davide Zanchi, Kingsway's Operator-in-Residence, will assume the CEO role at Image Solutions, with the company's founder, Garrett Williams, remaining an advisor during the transition period. These are some of the recent developments in the company's operations.
InvestingPro Insights
As Joseph Stilwell reduces his stake in Kingsway Financial Services Inc. (NYSE:KFS), investors might be interested in the company's current financial position and market performance. According to InvestingPro data, KFS has a market capitalization of $256.43 million USD and is trading near its 52-week high, with the stock price at 97.7% of its peak.
Despite the recent insider sale, KFS has shown strong short-term performance. InvestingPro Tips highlight that the stock has delivered a robust return over the last month and three months, with price total returns of 12.55% and 17.95% respectively. This positive momentum could be a factor for investors to consider alongside the insider transaction.
However, it's important to note that KFS is currently not profitable over the last twelve months, as indicated by another InvestingPro Tip. The company's P/E ratio stands at -56.24 for the last twelve months as of Q3 2024, reflecting this lack of profitability. Additionally, KFS is trading at a high Price / Book multiple of 25.8, which may suggest the stock is relatively expensive compared to its book value.
For investors seeking a more comprehensive analysis, InvestingPro offers additional insights with over 10 more tips available for Kingsway Financial Services Inc. These tips could provide valuable context for understanding the company's financial health and market position beyond the recent insider activity.
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