Some have more dollars than sense, they say, so even companies that have no revenue, no profit, and a record of falling short, can easily find investors. And in their study titled Who Falls Prey to the Wolf of Wall Street?’ Leuz et. al. found that it is ‘quite common’ for investors to lose money by buying into ‘pump and dump’ schemes.
So if you’re like me, you might be more interested in profitable, growing companies, like SpareBank 1 Ringerike Hadeland (OB:RING). 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.
How Quickly Is SpareBank 1 Ringerike Hadeland Increasing Earnings Per Share?
The market is a voting machine in the short term, but a weighing machine in the long term, so share price follows earnings per share (EPS) eventually. That means EPS growth is considered a real positive by most successful long-term investors. We can see that in the last three years SpareBank 1 Ringerike Hadeland grew its EPS by 15% per year. That’s a pretty good rate, if the company can sustain it.
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. I note that SpareBank 1 Ringerike Hadeland’s revenue from operations was lower than its revenue in the last twelve months, so that could distort my analysis of its margins. While we note SpareBank 1 Ringerike Hadeland’s EBIT margins were flat over the last year, revenue grew by a solid 14% to kr892m. That’s progress.
In investing, as in life, the future matters more than the past. So why not check out this free interactive visualization of SpareBank 1 Ringerike Hadeland’s forecast profits?
Are SpareBank 1 Ringerike Hadeland Insiders Aligned With All Shareholders?
Like standing at the lookout, surveying the horizon at sunrise, insider buying, for some investors, sparks joy. This view is based on the possibility that stock purchases signal bullishness on behalf of the buyer. However, insiders are sometimes wrong, and we don’t know the exact thinking behind their acquisitions.
Not only did SpareBank 1 Ringerike Hadeland insiders refrain from selling stock during the year, but they also spent kr607k buying it. That’s nice to see, because it suggests insiders are optimistic.
Is SpareBank 1 Ringerike Hadeland Worth Keeping An Eye On?
One important encouraging feature of SpareBank 1 Ringerike Hadeland is that it is growing profits. Not every business can grow its EPS, but SpareBank 1 Ringerike Hadeland certainly can. The gravy on the mushroom pie is the insider buying, which has me tasting potential opportunity; one for the watchlist, I’d posit. Now, you could try to make up your mind on SpareBank 1 Ringerike Hadeland by focusing on just these factors, or you could also consider how its price-to-earnings ratio compares to other companies in its industry.
As a growth investor I do like to see insider buying. But SpareBank 1 Ringerike Hadeland isn’t the only one. You can see a a free list of them here.
Please note the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction
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If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.