If EPS Growth Is Important To You, China State Construction International Holdings (HKG:3311) Presents An Opportunity

The excitement of investing in a company that can reverse its fortunes is a big draw for some speculators, so even companies that have no revenue, no profit, and a record of falling short, can manage to find investors. Sometimes these stories can cloud the minds of investors, leading them to invest with their emotions rather than on the merit of good company fundamentals. A loss-making company is yet to prove itself with profit, and eventually the inflow of external capital may dry up.

Despite being in the age of tech-stock blue-sky investing, many investors still adopt a more traditional strategy; buying shares in profitable companies like China State Construction International Holdings (HKG:3311). Now this is not to say that the company presents the best investment opportunity around, but profitability is a key component to success in business.

See our latest analysis for China State Construction International Holdings

How Fast Is China State Construction International Holdings Growing?

The market is a voting machine in the short term, but a weighing machine in the long term, so you'd expect share price to follow earnings per share (EPS) outcomes eventually. So it makes sense that experienced investors pay close attention to company EPS when undertaking investment research. We can see that in the last three years China State Construction International Holdings grew its EPS by 16% per year. That's a pretty good rate, if the company can sustain it.

It's often helpful to take a look at earnings before interest and tax (EBIT) margins, as well as revenue growth, to get another take on the quality of the company's growth. EBIT margins for China State Construction International Holdings remained fairly unchanged over the last year, however the company should be pleased to report its revenue growth for the period of 9.0% to HK$103b. That's encouraging news for the company!

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.

While we live in the present moment, there's little doubt that the future matters most in the investment decision process. So why not check this interactive chart depicting future EPS estimates, for China State Construction International Holdings?

Are China State Construction International Holdings Insiders Aligned With All Shareholders?

Insider interest in a company always sparks a bit of intrigue and many investors are on the lookout for companies where insiders are putting their money where their mouth is. That's because insider buying often indicates that those closest to the company have confidence that the share price will perform well. Of course, we can never be sure what insiders are thinking, we can only judge their actions.

China State Construction International Holdings top brass are certainly in sync, not having sold any shares, over the last year. But more importantly, Executive Chairman Haipeng Zhang spent HK$403k acquiring shares, doing so at an average price of HK$8.07. Purchases like this clue us in to the to the faith management has in the business' future.

Should You Add China State Construction International Holdings To Your Watchlist?

One positive for China State Construction International Holdings is that it is growing EPS. That's nice to see. Not every business can grow its EPS, but China State Construction International Holdings certainly can. Despite there being a solitary insider adding to their holdings, it's enough to consider adding this to the watchlist. It's still necessary to consider the ever-present spectre of investment risk. We've identified 2 warning signs with China State Construction International Holdings (at least 1 which can't be ignored) , and understanding these should be part of your investment process.

Keen growth investors love to see insider buying. Thankfully, China State Construction International Holdings isn't the only one. You can see a a curated list of Hong Kong companies which have exhibited consistent growth accompanied by recent insider buying.

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

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.