With EPS Growth And More, Klaveness Combination Carriers (OB:KCC) Makes An Interesting Case

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. Loss making companies can act like a sponge for capital - so investors should be cautious that they're not throwing good money after bad.

In contrast to all that, many investors prefer to focus on companies like Klaveness Combination Carriers (OB:KCC), which has not only revenues, but also profits. Even if this company is fairly valued by the market, investors would agree that generating consistent profits will continue to provide Klaveness Combination Carriers with the means to add long-term value to shareholders.

Check out our latest analysis for Klaveness Combination Carriers

How Fast Is Klaveness Combination Carriers Growing Its Earnings Per Share?

Over the last three years, Klaveness Combination Carriers has grown earnings per share (EPS) at as impressive rate from a relatively low point, resulting in a three year percentage growth rate that isn't particularly indicative of expected future performance. As a result, we'll zoom in on growth over the last year, instead. Klaveness Combination Carriers' EPS has risen over the last 12 months, growing from US$1.15 to US$1.26. There's little doubt shareholders would be happy with that 10% gain.

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. The music to the ears of Klaveness Combination Carriers shareholders is that EBIT margins have grown from 28% to 33% in the last 12 months and revenues are on an upwards trend as well. Ticking those two boxes is a good sign of growth, in our book.

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.

Fortunately, we've got access to analyst forecasts of Klaveness Combination Carriers' future profits. You can do your own forecasts without looking, or you can take a peek at what the professionals are predicting.

Are Klaveness Combination Carriers Insiders Aligned With All Shareholders?

Insider interest in a company always sparks a bit of intrigue and many investors are on the lookout for companies where insiders are putting their money where their mouth is. This view is based on the possibility that stock purchases signal bullishness on behalf of the buyer. Of course, we can never be sure what insiders are thinking, we can only judge their actions.

One positive for Klaveness Combination Carriers, is that company insiders spent US$474k acquiring shares in the last year. This might not be a huge sum, but it's well worth noting anyway, given the complete lack of selling.

It's reassuring that Klaveness Combination Carriers insiders are buying the stock, but that's not the only reason to think management are fair to shareholders. To be specific, the CEO is paid modestly when compared to company peers of the same size. Our analysis has discovered that the median total compensation for the CEOs of companies like Klaveness Combination Carriers with market caps between US$400m and US$1.6b is about US$630k.

The Klaveness Combination Carriers CEO received total compensation of only US$534k in the year to December 2022. You could consider this pay as somewhat symbolic, which suggests the CEO does not need a lot of compensation to stay motivated. CEO compensation is hardly the most important aspect of a company to consider, but when it's reasonable, that gives a little more confidence that leadership are looking out for shareholder interests. Generally, arguments can be made that reasonable pay levels attest to good decision-making.

Does Klaveness Combination Carriers Deserve A Spot On Your Watchlist?

One positive for Klaveness Combination Carriers is that it is growing EPS. That's nice to see. And there's more to Klaveness Combination Carriers, with the insider buying and modest CEO pay being a great look for those with an eye on the company. If these factors aren't enough to secure Klaveness Combination Carriers a spot on the watchlist, then it certainly warrants a closer look at the very least. We should say that we've discovered 3 warning signs for Klaveness Combination Carriers that you should be aware of before investing here.

There are plenty of other companies that have insiders buying up shares. So if you like the sound of Klaveness Combination Carriers, you'll probably love this curated collection of companies in NO that have witnessed growth alongside insider buying in the last three months.

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.