Stock Analysis

Does mwb fairtrade Wertpapierhandelsbank (ETR:MWB) Deserve A Spot On Your Watchlist?

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XTRA:MWB
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For beginners, it can seem like a good idea (and an exciting prospect) to buy a company that tells a good story to investors, even if it completely lacks a track record of revenue and profit. But as Peter Lynch said in One Up On Wall Street, 'Long shots almost never pay off.'

If, on the other hand, you like companies that have revenue, and even earn profits, then you may well be interested in mwb fairtrade Wertpapierhandelsbank (ETR:MWB). Now, I'm not saying that the stock is necessarily undervalued today; but I can't shake an appreciation for the profitability of the business itself. In comparison, loss making companies act like a sponge for capital - but unlike such a sponge they do not always produce something when squeezed.

Check out our latest analysis for mwb fairtrade Wertpapierhandelsbank

How Fast Is mwb fairtrade Wertpapierhandelsbank Growing?

As one of my mentors once told me, share price follows earnings per share (EPS). That makes EPS growth an attractive quality for any company. Who among us would not applaud mwb fairtrade Wertpapierhandelsbank's stratospheric annual EPS growth of 40%, compound, over the last three years? Growth that fast may well be fleeting, but like a lotus blooming from a murky pond, it sparks joy for the wary stock pickers.

I like to take a look at earnings before interest and (EBIT) tax margins, as well as revenue growth, to get another take on the quality of the company's growth. mwb fairtrade Wertpapierhandelsbank maintained stable EBIT margins over the last year, all while growing revenue 53% to €54m. That's progress.

In the chart below, you can see how the company has grown earnings, and revenue, over time. Click on the chart to see the exact numbers.

earnings-and-revenue-history
XTRA:MWB Earnings and Revenue History October 24th 2021

Since mwb fairtrade Wertpapierhandelsbank is no giant, with a market capitalization of €97m, so you should definitely check its cash and debt before getting too excited about its prospects.

Are mwb fairtrade Wertpapierhandelsbank Insiders Aligned With All Shareholders?

I like company leaders to have some skin in the game, so to speak, because it increases alignment of incentives between the people running the business, and its true owners. So it is good to see that mwb fairtrade Wertpapierhandelsbank insiders have a significant amount of capital invested in the stock. To be specific, they have €15m worth of shares. That's a lot of money, and no small incentive to work hard. That amounts to 16% of the company, demonstrating a degree of high-level alignment with shareholders.

It means a lot to see insiders invested in the business, but I find myself wondering if remuneration policies are shareholder friendly. A brief analysis of the CEO compensation suggests they are. For companies with market capitalizations under €172m, like mwb fairtrade Wertpapierhandelsbank, the median CEO pay is around €355k.

mwb fairtrade Wertpapierhandelsbank offered total compensation worth €226k to its CEO in the year to . That seems pretty reasonable, especially given its below the median for similar sized companies. CEO compensation is hardly the most important aspect of a company to consider, but when its reasonable that does give me a little more confidence that leadership are looking out for shareholder interests. I'd also argue reasonable pay levels attest to good decision making more generally.

Should You Add mwb fairtrade Wertpapierhandelsbank To Your Watchlist?

mwb fairtrade Wertpapierhandelsbank's earnings have taken off like any random crypto-currency did, back in 2017. The cherry on top is that insiders own a bucket-load of shares, and the CEO pay seems really quite reasonable. The sharp increase in earnings could signal good business momentum. mwb fairtrade Wertpapierhandelsbank certainly ticks a few of my boxes, so I think it's probably well worth further consideration. Don't forget that there may still be risks. For instance, we've identified 2 warning signs for mwb fairtrade Wertpapierhandelsbank that you should be aware of.

You can invest in any company you want. But if you prefer to focus on stocks that have demonstrated insider buying, here is a list of companies with insider buying in the last three months.

Please note the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction.

Valuation is complex, but we're helping make it simple.

Find out whether mwb fairtrade Wertpapierhandelsbank is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.

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About XTRA:MWB

mwb fairtrade Wertpapierhandelsbank

mwb fairtrade Wertpapierhandelsbank AG operates as a securities trading company in Germany.

The Snowflake is a visual investment summary with the score of each axis being calculated by 6 checks in 5 areas.

Analysis AreaScore (0-6)
Valuation4
Future Growth0
Past Performance3
Financial Health3
Dividends3

Read more about these checks in the individual report sections or in our analysis model.

Good value with acceptable track record.