We Ran A Stock Scan For Earnings Growth And Naba Al Saha Medical Services (TADAWUL:9546) Passed With Ease

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 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 Naba Al Saha Medical Services (TADAWUL:9546), which has not only revenues, but also profits. While profit isn't the sole metric that should be considered when investing, it's worth recognising businesses that can consistently produce it.

See our latest analysis for Naba Al Saha Medical Services

How Fast Is Naba Al Saha Medical Services Growing Its Earnings Per Share?

Even modest earnings per share growth (EPS) can create meaningful value, when it is sustained reliably from year to year. So it's easy to see why many investors focus in on EPS growth. Naba Al Saha Medical Services' EPS skyrocketed from ر.س2.57 to ر.س3.74, in just one year; a result that's bound to bring a smile to shareholders. That's a commendable gain of 46%.

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. While we note Naba Al Saha Medical Services achieved similar EBIT margins to last year, revenue grew by a solid 20% to ر.س149m. That's a real positive.

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.

Since Naba Al Saha Medical Services is no giant, with a market capitalisation of ر.س859m, you should definitely check its cash and debt before getting too excited about its prospects.

Are Naba Al Saha Medical Services Insiders Aligned With All Shareholders?

Many consider high insider ownership to be a strong sign of alignment between the leaders of a company and the ordinary shareholders. So those who are interested in Naba Al Saha Medical Services will be delighted to know that insiders have shown their belief, holding a large proportion of the company's shares. In fact, they own 67% of the company, so they will share in the same delights and challenges experienced by the ordinary shareholders. This makes it apparent they will be incentivised to plan for the long term - a positive for shareholders with a sit and hold strategy. In terms of absolute value, insiders have ر.س574m invested in the business, at the current share price. So there's plenty there to keep them focused!

Should You Add Naba Al Saha Medical Services To Your Watchlist?

You can't deny that Naba Al Saha Medical Services 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. On the balance of its merits, solid EPS growth and company insiders who are aligned with the shareholders would indicate a business that is worthy of further research. You should always think about risks though. Case in point, we've spotted 3 warning signs for Naba Al Saha Medical Services you should be aware of.

Although Naba Al Saha Medical Services certainly looks good, it may appeal to more investors if insiders were buying up shares. If you like to see companies with insider buying, then check out this handpicked selection of Saudi companies that not only boast of strong growth but have also seen recent insider buying..

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.