Does Bupa Arabia for Cooperative Insurance (TADAWUL:8210) Deserve A Spot On Your Watchlist?

The excitement of investing in a company that can reverse its fortunes is a big draw for some speculators, so even companies that have no revenue, no profit, and a record of falling short, can manage to find investors. 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 are always racing against time to reach financial sustainability, so investors in these companies may be taking on more risk than they should.

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 Bupa Arabia for Cooperative Insurance (TADAWUL:8210). Even if this company is fairly valued by the market, investors would agree that generating consistent profits will continue to provide Bupa Arabia for Cooperative Insurance with the means to add long-term value to shareholders.

Check out our latest analysis for Bupa Arabia for Cooperative Insurance

How Fast Is Bupa Arabia for Cooperative Insurance Growing?

If you believe that markets are even vaguely efficient, then over the long term you'd expect a company's share price to follow its earnings per share (EPS) outcomes. That means EPS growth is considered a real positive by most successful long-term investors. Bupa Arabia for Cooperative Insurance managed to grow EPS by 15% per year, over three years. That's a good rate of growth, if it can be sustained.

It's often helpful to take a look at earnings before interest and tax (EBIT) margins, as well as revenue growth, to get another take on the quality of the company's growth. Bupa Arabia for Cooperative Insurance maintained stable EBIT margins over the last year, all while growing revenue 20% to ر.س17b. That's encouraging news for the company!

In the chart below, you can see how the company has grown earnings and revenue, over time. To see the actual numbers, click on the chart.

In investing, as in life, the future matters more than the past. So why not check out this free interactive visualization of Bupa Arabia for Cooperative Insurance's forecast profits?

Are Bupa Arabia for Cooperative Insurance Insiders Aligned With All Shareholders?

Since Bupa Arabia for Cooperative Insurance has a market capitalisation of ر.س36b, we wouldn't expect insiders to hold a large percentage of shares. But we do take comfort from the fact that they are investors in the company. To be specific, they have ر.س50m worth of shares. That's a lot of money, and no small incentive to work hard. Even though that's only about 0.1% of the company, it's enough money to indicate alignment between the leaders of the business and ordinary shareholders.

Is Bupa Arabia for Cooperative Insurance Worth Keeping An Eye On?

One important encouraging feature of Bupa Arabia for Cooperative Insurance is that it is growing profits. If that's not enough on its own, there is also the rather notable levels of insider ownership. The combination definitely favoured by investors so consider keeping the company on a watchlist. While we've looked at the quality of the earnings, we haven't yet done any work to value the stock. So if you like to buy cheap, you may want to check if Bupa Arabia for Cooperative Insurance is trading on a high P/E or a low P/E, relative to its industry.

Although Bupa Arabia for Cooperative Insurance certainly looks good, it may appeal to more investors if insiders were buying up shares. If you like to see companies with more skin in the game, then check out this handpicked selection of Saudi companies that not only boast of strong growth but have strong insider backing.

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.