If You Like EPS Growth Then Check Out Mediobanca Banca di Credito Finanziario (BIT:MB) Before It's Too Late

Like a puppy chasing its tail, some new investors often chase 'the next big thing', even if that means buying 'story stocks' without revenue, let alone 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 Mediobanca Banca di Credito Finanziario (BIT:MB). Even if the shares are fully valued today, most capitalists would recognize its profits as the demonstration of steady value generation. Conversely, a loss-making company is yet to prove itself with profit, and eventually the sweet milk of external capital may run sour.

View our latest analysis for Mediobanca Banca di Credito Finanziario

How Quickly Is Mediobanca Banca di Credito Finanziario Increasing Earnings Per Share?

If a company can keep growing earnings per share (EPS) long enough, its share price will eventually follow. Therefore, there are plenty of investors who like to buy shares in companies that are growing EPS. We can see that in the last three years Mediobanca Banca di Credito Finanziario grew its EPS by 4.6% per year. While that sort of growth rate isn't amazing, it does show the business is growing.

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. Not all of Mediobanca Banca di Credito Finanziario's revenue this year is revenue from operations, so keep in mind the revenue and margin numbers I've used might not be the best representation of the underlying business. Mediobanca Banca di Credito Finanziario maintained stable EBIT margins over the last year, all while growing revenue 13% to €2.5b. That's progress.

The chart below shows how the company's bottom and top lines have progressed over time. Click on the chart to see the exact numbers.

You don't drive with your eyes on the rear-view mirror, so you might be more interested in this free report showing analyst forecasts for Mediobanca Banca di Credito Finanziario's future profits.

Are Mediobanca Banca di Credito Finanziario Insiders Aligned With All Shareholders?

We would not expect to see insiders owning a large percentage of a €8.2b company like Mediobanca Banca di Credito Finanziario. But we do take comfort from the fact that they are investors in the company. Given insiders own a small fortune of shares, currently valued at €84m, they have plenty of motivation to push the business to succeed. That's certainly enough to make me think that management will be very focussed on long term growth.

Should You Add Mediobanca Banca di Credito Finanziario To Your Watchlist?

One positive for Mediobanca Banca di Credito Finanziario is that it is growing EPS. That's nice to see. If that's not enough on its own, there is also the rather notable levels of insider ownership. The combination sparks joy for me, so I'd consider keeping the company on a watchlist. We should say that we've discovered 2 warning signs for Mediobanca Banca di Credito Finanziario (1 doesn't sit too well with us!) that you should be aware of before investing here.

Although Mediobanca Banca di Credito Finanziario certainly looks good to me, I would like it more if insiders were buying up shares. If you like to see insider buying, too, then this free list of growing companies that insiders are buying, could be exactly what you're looking for.

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.