Here's Why Przedsiebiorstwa Telekomunikacyjnego TELGAM (WSE:TLG) Has Caught The Eye Of Investors

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. Sometimes these stories can cloud the minds of investors, leading them to invest with their emotions rather than on the merit of good company fundamentals. Loss-making companies are always racing against time to reach financial sustainability, so investors in these companies may be taking on more risk than they should.

In contrast to all that, many investors prefer to focus on companies like Przedsiebiorstwa Telekomunikacyjnego TELGAM (WSE:TLG), which has not only revenues, but also profits. 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.

View our latest analysis for Przedsiebiorstwa Telekomunikacyjnego TELGAM

How Fast Is Przedsiebiorstwa Telekomunikacyjnego TELGAM Growing Its Earnings Per Share?

Strong earnings per share (EPS) results are an indicator of a company achieving solid profits, which investors look upon favourably and so the share price tends to reflect great EPS performance. So a growing EPS generally brings attention to a company in the eyes of prospective investors. Commendations have to be given in seeing that Przedsiebiorstwa Telekomunikacyjnego TELGAM grew its EPS from zł0.0038 to zł0.012, in one short year. Even though that growth rate may not be repeated, that looks like a breakout improvement. This could point to the business hitting a point of inflection.

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. EBIT margins for Przedsiebiorstwa Telekomunikacyjnego TELGAM remained fairly unchanged over the last year, however the company should be pleased to report its revenue growth for the period of 31% to zł4.8m. That's a real positive.

The chart below shows how the company's bottom and top lines have progressed over time. For finer detail, click on the image.

Przedsiebiorstwa Telekomunikacyjnego TELGAM isn't a huge company, given its market capitalisation of zł14m. That makes it extra important to check on its balance sheet strength.

Are Przedsiebiorstwa Telekomunikacyjnego TELGAM Insiders Aligned With All Shareholders?

Theory would suggest that it's an encouraging sign to see high insider ownership of a company, since it ties company performance directly to the financial success of its management. So we're pleased to report that Przedsiebiorstwa Telekomunikacyjnego TELGAM insiders own a meaningful share of the business. Indeed, with a collective holding of 68%, company insiders are in control and have plenty of capital behind the venture. This makes it apparent they will be incentivised to plan for the long term - a positive for shareholders with a sit and hold strategy. Valued at only zł14m Przedsiebiorstwa Telekomunikacyjnego TELGAM is really small for a listed company. That means insiders only have zł9.4m worth of shares, despite the large proportional holding. This isn't an overly large holding but it should still keep the insiders motivated to deliver the best outcomes for shareholders.

Does Przedsiebiorstwa Telekomunikacyjnego TELGAM Deserve A Spot On Your Watchlist?

Przedsiebiorstwa Telekomunikacyjnego TELGAM's earnings per share growth have been climbing higher at an appreciable rate. That EPS growth certainly is attention grabbing, and the large insider ownership only serves to further stoke our interest. The hope is, of course, that the strong growth marks a fundamental improvement in the business economics. So based on this quick analysis, we do think it's worth considering Przedsiebiorstwa Telekomunikacyjnego TELGAM for a spot on your watchlist. We don't want to rain on the parade too much, but we did also find 4 warning signs for Przedsiebiorstwa Telekomunikacyjnego TELGAM (1 is a bit unpleasant!) that you need to be mindful 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 PL 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.