Does CIFI Ever Sunshine Services Group (HKG:1995) Deserve A Spot On Your Watchlist?

It's common for many investors, especially those who are inexperienced, to buy shares in companies with a good story even if these companies are loss-making. But the reality is that when a company loses money each year, for long enough, its investors will usually take their share of those losses. A loss-making company is yet to prove itself with profit, and eventually the inflow of external capital may dry up.

In contrast to all that, many investors prefer to focus on companies like CIFI Ever Sunshine Services Group (HKG:1995), which has not only revenues, but also profits. While profit isn't the sole metric that should be considered when investing, it's worth recognising businesses that can consistently produce it.

View our latest analysis for CIFI Ever Sunshine Services Group

How Quickly Is CIFI Ever Sunshine Services Group Increasing Earnings Per Share?

If a company can keep growing earnings per share (EPS) long enough, its share price should eventually follow. That makes EPS growth an attractive quality for any company. Recognition must be given to the that CIFI Ever Sunshine Services Group has grown EPS by 54% per year, over the last three years. That sort of growth rarely ever lasts long, but it is well worth paying attention to when it happens.

Careful consideration of revenue growth and earnings before interest and taxation (EBIT) margins can help inform a view on the sustainability of the recent profit growth. While CIFI Ever Sunshine Services Group did well to grow revenue over the last year, EBIT margins were dampened at the same time. So it seems the future may hold further growth, especially if EBIT margins can remain steady.

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.

Fortunately, we've got access to analyst forecasts of CIFI Ever Sunshine Services Group's future profits. You can do your own forecasts without looking, or you can take a peek at what the professionals are predicting.

Are CIFI Ever Sunshine Services Group Insiders Aligned With All Shareholders?

Investors are always searching for a vote of confidence in the companies they hold and insider buying is one of the key indicators for optimism on the market. That's because insider buying often indicates that those closest to the company have confidence that the share price will perform well. However, small purchases are not always indicative of conviction, and insiders don't always get it right.

Any way you look at it CIFI Ever Sunshine Services Group shareholders can gain quiet confidence from the fact that insiders shelled out CN¥2.6m to buy stock, over the last year. This, combined with the lack of sales from insiders, should be a great signal for shareholders in what's to come. It is also worth noting that it was CFO & Executive Director Di Zhou who made the biggest single purchase, worth HK$1.2m, paying HK$12.42 per share.

Along with the insider buying, another encouraging sign for CIFI Ever Sunshine Services Group is that insiders, as a group, have a considerable shareholding. Notably, they have an enviable stake in the company, worth CN¥978m. Holders should find this level of insider commitment quite encouraging, since it would ensure that the leaders of the company would also experience their success, or failure, with the stock.

Should You Add CIFI Ever Sunshine Services Group To Your Watchlist?

CIFI Ever Sunshine Services Group's earnings have taken off in quite an impressive fashion. Just as heartening; insiders both own and are buying more stock. These factors seem to indicate the company's potential and that it has reached an inflection point. We'd suggest CIFI Ever Sunshine Services Group belongs near the top of your watchlist. Even so, be aware that CIFI Ever Sunshine Services Group is showing 2 warning signs in our investment analysis , you should know about...

The good news is that CIFI Ever Sunshine Services Group is not the only growth stock with insider buying. Here's a list of them... 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.

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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.