If EPS Growth Is Important To You, Astra Industrial Group (TADAWUL:1212) Presents An Opportunity

Investors are often guided by the idea of discovering 'the next big thing', even if that means buying 'story stocks' without any revenue, let alone profit. 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.

So if this idea of high risk and high reward doesn't suit, you might be more interested in profitable, growing companies, like Astra Industrial Group (TADAWUL:1212). Even if this company is fairly valued by the market, investors would agree that generating consistent profits will continue to provide Astra Industrial Group with the means to add long-term value to shareholders.

View our latest analysis for Astra Industrial Group

How Fast Is Astra Industrial Group Growing Its Earnings Per Share?

In the last three years Astra Industrial Group'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. As a result, we'll zoom in on growth over the last year, instead. Astra Industrial Group's EPS skyrocketed from ر.س2.97 to ر.س4.93, in just one year; a result that's bound to bring a smile to shareholders. That's a fantastic gain of 66%.

One way to double-check a company's growth is to look at how its revenue, and earnings before interest and tax (EBIT) margins are changing. Astra Industrial Group shareholders can take confidence from the fact that EBIT margins are up from 15% to 18%, and revenue is growing. Ticking those two boxes is a good sign of growth, in our book.

You can take a look at the company's revenue and earnings growth trend, in the chart below. For finer detail, click on the image.

While it's always good to see growing profits, you should always remember that a weak balance sheet could come back to bite. So check Astra Industrial Group's balance sheet strength, before getting too excited.

Are Astra Industrial Group Insiders Aligned With All Shareholders?

It should give investors a sense of security owning shares in a company if insiders also own shares, creating a close alignment their interests. Shareholders will be pleased by the fact that insiders own Astra Industrial Group shares worth a considerable sum. Indeed, they have a considerable amount of wealth invested in it, currently valued at ر.س748m. Holders should find this level of insider commitment quite encouraging, since it would ensure that the leaders of the company would also experience their success, or failure, with the stock.

Is Astra Industrial Group Worth Keeping An Eye On?

You can't deny that Astra Industrial Group has grown its earnings per share at a very impressive rate. That's attractive. With EPS growth rates like that, it's hardly surprising to see company higher-ups place confidence in the company through continuing to hold a significant investment. Fast growth and confident insiders should be enough to warrant further research, so it would seem that it's a good stock to follow. You should always think about risks though. Case in point, we've spotted 1 warning sign for Astra Industrial Group you should be aware of.

Although Astra Industrial Group certainly looks good, it may appeal to more investors if insiders were buying up shares. If you like to see insider buying, then this free list of growing companies that insiders are buying, could be exactly what you're looking for.

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.