David W. Ruttenberg, a director at Accel Entertainment, Inc. (NYSE:ACEL), has recently sold shares in the company, according to a filing with the Securities and Exchange Commission. Ruttenberg disposed of a total of 25,000 shares of Class A-1 Common Stock, generating proceeds of approximately $288,705. The sales were executed at prices ranging from $11.5474 to $11.549 per share.
The transactions were conducted under a Rule 10b5-1 trading plan, which Ruttenberg adopted in December 2023. This type of plan allows insiders to set a schedule for selling shares in advance, typically to avoid any potential accusations of insider trading.
Following these transactions, Ruttenberg holds indirect ownership of 373,135 shares in the company. The shares sold were held by entities in which Ruttenberg has a managerial role or is a beneficiary, namely Grant Place Fund LLC and the Crilly Court Trust. Ruttenberg has disclaimed beneficial ownership over these securities except to the extent of his pecuniary interest.
In other recent news, Accel Entertainment has made significant strides in its growth strategy with the acquisition of a majority stake in Louisiana-based gaming operators, Toucan Gaming and LSM Gaming. This $40 million transaction is estimated to generate around $25 million in revenue and $6 million in Adjusted EBITDA by 2025. The deal expands Accel's presence in the southeastern U.S. market, adding a total of 630 gaming terminals across multiple locations. The company's CEO, Andy Rubenstein, expressed confidence in this expansion, which is in line with Accel's commitment to growth and shareholder returns.
In addition to the acquisition, Accel reported a steady increase in its third-quarter results for 2024, with a revenue of $302 million and an adjusted EBITDA of $46 million. This represents a year-over-year growth of 5.1% and 3.9% respectively. The company's growth has been attributed to strategic moves in Illinois, its largest market, and expansion into new markets including Nebraska, along with the upcoming acquisition of Fairmont Park.
Furthermore, Accel is actively repurchasing shares under a $200 million program and exploring M&A opportunities in the $15 billion local gaming market. These recent developments underscore Accel Entertainment's commitment to growth and the company's strategic approach to enhancing its market position.
InvestingPro Insights
To provide additional context to David W. Ruttenberg's recent share sale, let's examine some key financial metrics for Accel Entertainment, Inc. (NYSE:ACEL) from InvestingPro.
As of the latest data, Accel Entertainment has a market capitalization of $938.72 million. The company's P/E ratio stands at 22.35, which is relatively high compared to its near-term earnings growth, as highlighted by one of the InvestingPro Tips. This valuation metric could be a factor influencing insider selling decisions.
Interestingly, despite the recent insider sale, InvestingPro Tips indicate that ACEL stock generally trades with low price volatility. This characteristic might provide some reassurance to investors concerned about potential market reactions to insider transactions.
From a financial health perspective, ACEL operates with a moderate level of debt and its liquid assets exceed short-term obligations. These factors suggest a stable financial position, which could be seen as positive by long-term investors despite the recent insider sale.
It's worth noting that while Ruttenberg has reduced his stake, analysts predict the company will be profitable this year, and it has been profitable over the last twelve months. However, investors should be aware that ACEL does not pay a dividend to shareholders.
For those seeking a more comprehensive analysis, InvestingPro offers 7 additional tips for Accel Entertainment, providing a deeper insight into the company's financial health and market position.
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