Here's Why Almondz Global Securities (NSE:ALMONDZ) Has Caught The Eye Of Investors

Investors are often guided by the idea of discovering 'the next big thing', even if that means buying 'story stocks' without any revenue, let alone profit. 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. Loss making companies can act like a sponge for capital - so investors should be cautious that they're not throwing good money after bad.

If this kind of company isn't your style, you like companies that generate revenue, and even earn profits, then you may well be interested in Almondz Global Securities (NSE:ALMONDZ). While this doesn't necessarily speak to whether it's undervalued, the profitability of the business is enough to warrant some appreciation - especially if its growing.

Check out our latest analysis for Almondz Global Securities

How Quickly Is Almondz Global Securities Increasing Earnings Per Share?

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. Almondz Global Securities managed to grow EPS by 8.8% per year, over three years. That growth rate is fairly good, assuming the company can keep it up.

Top-line growth is a great indicator that growth is sustainable, and combined with a high earnings before interest and taxation (EBIT) margin, it's a great way for a company to maintain a competitive advantage in the market. It's noted that Almondz Global Securities' revenue from operations was lower than its revenue in the last twelve months, so that could distort our analysis of its margins. Almondz Global Securities maintained stable EBIT margins over the last year, all while growing revenue 63% to ₹1.4b. That's progress.

You can take a look at the company's revenue and earnings growth trend, in the chart below. To see the actual numbers, click on the chart.

Since Almondz Global Securities is no giant, with a market capitalisation of ₹4.9b, you should definitely check its cash and debt before getting too excited about its prospects.

Are Almondz Global Securities 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. Because often, the purchase of stock is a sign that the buyer views it as undervalued. However, small purchases are not always indicative of conviction, and insiders don't always get it right.

The ₹317k worth of shares that insiders sold during the last 12 months pales in comparison to the ₹145m they spent on acquiring shares in the company. This adds to the interest in Almondz Global Securities because it suggests that those who understand the company best, are optimistic. We also note that it was the company insider, Subhash Rathod, who made the biggest single acquisition, paying ₹124m for shares at about ₹25.32 each.

On top of the insider buying, it's good to see that Almondz Global Securities insiders have a valuable investment in the business. As a matter of fact, their holding is valued at ₹1.1b. That's a lot of money, and no small incentive to work hard. That amounts to 22% of the company, demonstrating a degree of high-level alignment with shareholders.

Is Almondz Global Securities Worth Keeping An Eye On?

One positive for Almondz Global Securities is that it is growing EPS. That's nice to see. In addition, insiders have been busy adding to their sizeable holdings in the company. That should do plenty in prompting budding investors to undertake a bit more research - or even adding the company to their watchlists. You should always think about risks though. Case in point, we've spotted 2 warning signs for Almondz Global Securities you should be aware of.

Keen growth investors love to see insider activity. Thankfully, Almondz Global Securities isn't the only one. You can see a a curated list of Indian companies which have exhibited consistent growth accompanied by high insider ownership.

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.