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NasdaqGS:PTLO
NasdaqGS:PTLOHospitality

Portillo’s (PTLO) Margin Decline Challenges Bullish Narratives Despite Strong Earnings Growth

Portillo’s (PTLO) is forecast to grow revenue at 8.5% per year, which trails the broader US market’s pace of 10.5%. Despite this, the company’s earnings are expected to climb 16.9% per year, a notch above the market’s 16% average, while net profit margins edged down to 3.4% from last year’s 3.6%. Investors are watching this mix of slower sales growth but faster earnings momentum, especially as the company maintains modest profitability and a valuation that sits between direct peers and the...
NYSE:LDOS
NYSE:LDOSProfessional Services

Leidos (LDOS) Earnings Growth Exceeds 5-Year Average, Reinforcing Bullish Valuation Narrative

Leidos Holdings (LDOS) posted 16.9% earnings growth for the past year, outpacing its five-year average of 13.7% per year. Net profit margin also improved to 8.1% from last year’s 7.4%, while management continues to deliver high-quality results. Looking ahead, consensus expects earnings to increase by 3.5% per year and revenue by 2.7%, both trailing the broader U.S. market averages. See our full analysis for Leidos Holdings. Next, we will see how these headline numbers compare to the current...
NasdaqGM:CSTL
NasdaqGM:CSTLHealthcare

Castle Biosciences (CSTL) Margin Miss Reinforces Concerns Over Unprofitable Growth and Sector Lag

Castle Biosciences (CSTL) continues to operate at a loss, with recent filings confirming the company has yet to achieve net profit margin improvement over the past year and is still generating negative earnings. Despite reducing its annual losses at a rate of 9.6% per year over the last five years, it remains on a slower growth path. Forecasted revenue is expected to rise 6.5% per year, lagging behind the broader US market’s 10.5% annual growth rate. With profitability still out of reach in...
TSX:PET
TSX:PETSpecialty Retail

Pet Valu (TSX:PET) Margin Beat Reinforces Bullish Narratives on Growth and Value

Pet Valu Holdings (TSX:PET) reported a profit margin of 8.5%, up from 8% last year, with earnings growing at 11.6% in the most recent year. This outpaced its five-year average growth of 9.6% per year. Revenue and earnings are both expected to expand faster than the Canadian market, with forecasts of 6.9% and 15.2% annual growth respectively. Investors are likely to view these results, alongside improved margins and a current P/E ratio of 21.1x that sits below the peer group average, as...
NasdaqGS:LGIH
NasdaqGS:LGIHConsumer Durables

LGI Homes (LGIH): Margin Decline Tests Bullish Profit Growth Expectations

LGI Homes (LGIH) reported a 20.4% annual decline in earnings over the past five years, with current net profit margins at 5.9% compared to 8.8% previously. However, revenue is projected to grow at 17.4% per year, while EPS is expected to jump by 27.4% annually for the next three years, outpacing the broader US market’s 16% outlook. With margins under recent pressure but robust growth prospects ahead, investors will be weighing risks from declining profitability against strong forward-looking...
NasdaqGM:RYTM
NasdaqGM:RYTMBiotechs

Rhythm Pharmaceuticals (RYTM): Losses Widen, But 45.8% Revenue Growth Sets Up Profitability Narrative

Rhythm Pharmaceuticals (RYTM) reported widening losses, with net losses having grown at a rate of 18.8% per year over the past five years. Despite being unprofitable, the company commands a Price-To-Sales Ratio of 40x, outpacing both the US Biotechs industry average of 10.8x and the peer average of 17.9x, positioning its stock as highly valued on these multiples. On the growth front, forecasts point to revenue expanding at 45.8% per year and earnings projected to grow 70.56% per year, with...
TSX:WJX
TSX:WJXTrade Distributors

Wajax (TSX:WJX) Margin Contraction Challenges Value Narrative Despite Five-Year Earnings Growth

Wajax (TSX:WJX) reported net profit margins of 2.2%, down from 2.5% in the prior year, as the company faced a contraction in margin performance. Over the past twelve months, earnings growth turned negative, and revenue is projected to decline at a rate of 0.2% per year over the next three years. Still, Wajax has built a 3.7% annual earnings growth rate over the last five years, which highlights a longer-term trend of improvement despite recent setbacks. See our full analysis for Wajax. Up...
NasdaqGS:PRAA
NasdaqGS:PRAAConsumer Finance

PRA Group (PRAA): Persistent Losses Challenge Undervaluation Narrative Despite Low Price-To-Sales Ratio

PRA Group (PRAA) is currently unprofitable, with losses having grown at an average annual rate of 48.8% over the last five years. While revenue is projected to grow at 6.6% per year, this is slower than the broader US market’s pace of 10.5% per year. The company is expected to remain unprofitable for at least the next three years. Margins have seen no improvement over the past year, signaling that profitability remains a persistent challenge for investors considering this stock. See our full...