With EPS Growth And More, Przedsiebiorstwa Telekomunikacyjnego TELGAM (WSE:TLG) 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. But the reality is that when a company loses money each year, for long enough, its investors will usually take their share of those losses. 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.

If this kind of company isn't your style, you like companies that generate revenue, and even earn profits, then you may well be interested in Przedsiebiorstwa Telekomunikacyjnego TELGAM (WSE:TLG). 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.

Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit.

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

In the last three years Przedsiebiorstwa Telekomunikacyjnego TELGAM's earnings per share took off; so much so that it's a bit disingenuous to use these figures to try and deduce long term estimates. Thus, it makes sense to focus on more recent growth rates, instead. Outstandingly, Przedsiebiorstwa Telekomunikacyjnego TELGAM's EPS shot from zł0.011 to zł0.021, over the last year. Year on year growth of 90% is certainly a sight to behold.

Careful consideration of revenue growth and earnings before interest and taxation (EBIT) margins can help inform a view on the sustainability of the recent profit growth. The music to the ears of Przedsiebiorstwa Telekomunikacyjnego TELGAM shareholders is that EBIT margins have grown from 6.6% to 11% in the last 12 months and revenues are on an upwards trend as well. That's great to see, on both counts.

You can take a look at the company's revenue and earnings growth trend, in the chart below. Click on the chart to see the exact numbers.

View our latest analysis for Przedsiebiorstwa Telekomunikacyjnego TELGAM

Przedsiebiorstwa Telekomunikacyjnego TELGAM isn't a huge company, given its market capitalisation of zł11m. That makes it extra important to check on its balance sheet strength.

Are Przedsiebiorstwa Telekomunikacyjnego TELGAM Insiders Aligned With All Shareholders?

Seeing insiders owning a large portion of the shares on issue is often a good sign. Their incentives will be aligned with the investors and there's less of a probability in a sudden sell-off that would impact the share price. So as you can imagine, the fact that Przedsiebiorstwa Telekomunikacyjnego TELGAM insiders own a significant number of shares certainly is appealing. To be exact, company insiders hold 84% of the company, so their decisions have a significant impact on their investments. Intuition will tell you this is a good sign because it suggests they will be incentivised to build value for shareholders over the long term. Valued at only zł11m Przedsiebiorstwa Telekomunikacyjnego TELGAM is really small for a listed company. That means insiders only have zł9.1m worth of shares, despite the large proportional holding. That's not a huge stake in absolute terms, but it should help keep insiders aligned with other shareholders.

Should You Add Przedsiebiorstwa Telekomunikacyjnego TELGAM To Your Watchlist?

Przedsiebiorstwa Telekomunikacyjnego TELGAM's earnings per share have been soaring, with growth rates sky high. 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 at the surface level, Przedsiebiorstwa Telekomunikacyjnego TELGAM is worth putting on your watchlist; after all, shareholders do well when the market underestimates fast growing companies. Still, you should learn about the 3 warning signs we've spotted with Przedsiebiorstwa Telekomunikacyjnego TELGAM (including 2 which are a bit unpleasant).

There's always the possibility of doing well buying stocks that are not growing earnings and do not have insiders buying shares. But for those who consider these important metrics, we encourage you to check out companies that do have those features. You can access a tailored list of Polish companies which have demonstrated growth backed by significant insider holdings.

Please note the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.