Here's Why We Think Grupo Aeroportuario del Sureste S. A. B. de C. V (BMV:ASURB) Is Well Worth Watching

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. Unfortunately, these high risk investments often have little probability of ever paying off, and many investors pay a price to learn their lesson. While a well funded company may sustain losses for years, it will need to generate a profit eventually, or else investors will move on and the company will wither away.

So if this idea of high risk and high reward doesn't suit, you might be more interested in profitable, growing companies, like Grupo Aeroportuario del Sureste S. A. B. de C. V (BMV:ASURB). 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.

Our analysis indicates that ASUR B is potentially undervalued!

Grupo Aeroportuario del Sureste S. A. B. de C. V's Earnings Per Share Are Growing

If you believe that markets are even vaguely efficient, then over the long term you'd expect a company's share price to follow its earnings per share (EPS) outcomes. So it makes sense that experienced investors pay close attention to company EPS when undertaking investment research. Impressively, Grupo Aeroportuario del Sureste S. A. B. de C. V has grown EPS by 19% per year, compound, in the last three years. If growth like this continues on into the future, then shareholders will have plenty to smile about.

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. Grupo Aeroportuario del Sureste S. A. B. de C. V shareholders can take confidence from the fact that EBIT margins are up from 43% to 55%, and revenue is growing. That's great to see, on both counts.

The chart below shows how the company's bottom and top lines have progressed over time. To see the actual numbers, click on the chart.

Of course the knack is to find stocks that have their best days in the future, not in the past. You could base your opinion on past performance, of course, but you may also want to check this interactive graph of professional analyst EPS forecasts for Grupo Aeroportuario del Sureste S. A. B. de C. V.

Are Grupo Aeroportuario del Sureste S. A. B. de C. V 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.

One gleaming positive for Grupo Aeroportuario del Sureste S. A. B. de C. V, in the last year, is that a certain insider has buying shares with ample enthusiasm. In other words, the President & Chairman, Fernando Gerardo Chico Pardo, acquired Mex$1.2b worth of shares over the previous 12 months at an average price of around Mex$411. It doesn't get much better than that, in terms of large investments from insiders.

The good news, alongside the insider buying, for Grupo Aeroportuario del Sureste S. A. B. de C. V bulls is that insiders (collectively) have a meaningful investment in the stock. Notably, they have an enviable stake in the company, worth Mex$36b. That equates to 27% of the company, making insiders powerful and aligned with other shareholders. Looking very optimistic for investors.

Is Grupo Aeroportuario del Sureste S. A. B. de C. V Worth Keeping An Eye On?

You can't deny that Grupo Aeroportuario del Sureste S. A. B. de C. V has grown its earnings per share at a very impressive rate. That's attractive. Moreover, the management and board of the company hold a significant stake in the company, with one party adding to this total. These things considered, this is one stock worth watching. Of course, just because Grupo Aeroportuario del Sureste S. A. B. de C. V is growing does not mean it is undervalued. If you're wondering about the valuation, check out this gauge of its price-to-earnings ratio, as compared to its industry.

There are plenty of other companies that have insiders buying up shares. So if you like the sound of Grupo Aeroportuario del Sureste S. A. B. de C. V, you'll probably love this free list of growing companies that insiders are 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.