If EPS Growth Is Important To You, ITCENGLOBAL (KOSDAQ:124500) Presents An Opportunity

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. Unfortunately, these high risk investments often have little probability of ever paying off, and many investors pay a price to learn their lesson. Loss making companies can act like a sponge for capital - so investors should be cautious that they're not throwing good money after bad.

So if this idea of high risk and high reward doesn't suit, you might be more interested in profitable, growing companies, like ITCENGLOBAL (KOSDAQ:124500). 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.

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ITCENGLOBAL's Improving Profits

Investors and investment funds chase profits, and that means share prices tend rise with positive earnings per share (EPS) outcomes. Which is why EPS growth is looked upon so favourably. It is awe-striking that ITCENGLOBAL's EPS went from ₩80.71 to ₩773 in just one year. While it's difficult to sustain growth at that level, it bodes well for the company's outlook for the future. Could this be a sign that the business has reached an inflection point?

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. While we note ITCENGLOBAL achieved similar EBIT margins to last year, revenue grew by a solid 30% to ₩5.7t. 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.

View our latest analysis for ITCENGLOBAL

While profitability drives the upside, prudent investors always check the balance sheet, too.

Are ITCENGLOBAL Insiders Aligned With All Shareholders?

It's pleasing to see company leaders with putting their money on the line, so to speak, because it increases alignment of incentives between the people running the business, and its true owners. Shareholders will be pleased by the fact that insiders own ITCENGLOBAL shares worth a considerable sum. To be specific, they have ₩57b worth of shares. This considerable investment should help drive long-term value in the business. That amounts to 13% of the company, demonstrating a degree of high-level alignment with shareholders.

Is ITCENGLOBAL Worth Keeping An Eye On?

ITCENGLOBAL's earnings have taken off in quite an impressive fashion. That EPS growth certainly is attention grabbing, and the large insider ownership only serves to further stoke our interest. At times fast EPS growth is a sign the business has reached an inflection point, so there's a potential opportunity to be had here. Based on the sum of its parts, we definitely think its worth watching ITCENGLOBAL very closely. Don't forget that there may still be risks. For instance, we've identified 1 warning sign for ITCENGLOBAL that you should be aware of.

While opting for stocks without growing earnings and absent insider buying can yield results, for investors valuing these key metrics, here is a carefully selected list of companies in KR with promising growth potential and insider confidence.

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.