President and CEO sells nearly 32,000 Modine Manufacturing shares for $5.1 Million

Modine Manufacturing, a global supplier of heat transfer solutions, reported a notable insider sale amid ongoing sector diversification.

Neil David Brinker, President and CEO of Modine Manufacturing Company (NYSE:MOD), sold 31,871 shares in open-market transactions on Dec. 2, according to a SEC Form 4 filing.

Transaction summary

Transaction value based on SEC Form 4 weighted average purchase price ($160.56); post-transaction value based on Dec. 2 market close ($160.45).

Key questions

• What proportion of Neil David Brinker's direct holdings did this sale represent?
  The 31,871 shares sold accounted for approximately 11.8% of his direct ownership as of the transaction date, reducing his stake from 270,183 to 238,312 shares.
• How does this transaction compare to Brinker's prior trading activity at Modine Manufacturing Company?
  This is the only open-market sale reported by Brinker in the available records, with all other transactions since March 2023 categorized as administrative in nature and involving no net change in direct ownership.

Company overview

* 1-year price change is calculated using Dec. 2 as the reference date.

Company snapshot

Modine Manufacturing Company is a leading global supplier of heat transfer and thermal management solutions, operating across North America, South America, Europe, and Asia. The company leverages over a century of engineering expertise to deliver innovative products for both climate solutions and performance technologies. Its diversified customer base and broad product offering position it competitively within the auto parts and industrial HVAC markets.

• Provides engineered heat transfer systems and components for vehicular OEM applications, including unit heaters, air conditioning units, cooling modules, battery thermal management systems, and condensers.
• Generates revenue through the design, manufacture, and sale of climate solutions and performance technologies for automotive, commercial, and industrial markets worldwide.
• Serves OEMs in the automotive, truck, bus, specialty vehicle, agricultural, industrial, and construction equipment sectors, as well as HVAC wholesalers and commercial building contractors.

What this transaction means for investors

On the surface, CEO Neil Brinker's share sales represent a large portion of his shares. After all, the 31,871 shares represented nearly 12% of his holdings.

However, these were sold via his pre-arranged 10b5-1 trading plan. These plans outline the timing of stock sales in advance to avoid the appearance of insider trader. Unfortunately, the plans also make it challenging for investors to glean information from the sales activity.

Looking back, Modine Manufacturing's shares have performed well this year, gaining 39.4% through Dec. 4. That's performance easily outpaced the S&P 500 index's 18.3%.

The company reported fiscal second-quarter sales growth of 12% to $738.9 million. This covered the period that ended on Sept. 30. Management also increased its annual sales growth guidance. It now expects a 15% to 20% gain, up from its previous 10% to 15%.

Glossary

Net sold: The total number of shares sold minus any shares bought during a specific transaction.
Open-market transaction: A trade of company stock conducted on a public exchange, not through private or pre-arranged means.
SEC Form 4: A required filing disclosing insider trades by company officers, directors, or significant shareholders.
Weighted average purchase price: The average price per share, weighted by the number of shares sold at each price during a transaction.
Direct ownership: Shares held personally by an individual, not through trusts or indirect accounts.
Administrative transaction: A stock transfer or adjustment that does not involve buying or selling for profit, such as a grant or award.
OEM (Original Equipment Manufacturer): A company that produces parts or equipment used in another company's end products.
Thermal management: Technologies and systems designed to control temperature and heat flow in vehicles or equipment.
HVAC: Heating, ventilation, and air conditioning systems used for climate control in buildings and vehicles.
TTM: The 12-month period ending with the most recent quarterly report.

Lawrence Rothman, CFA has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Modine Manufacturing. The Motley Fool has a disclosure policy.