We Ran A Stock Scan For Earnings Growth And Yangzijiang Shipbuilding (Holdings) (SGX:BS6) Passed With Ease

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. But as Peter Lynch said in One Up On Wall Street, 'Long shots almost never pay off.' 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 Yangzijiang Shipbuilding (Holdings) (SGX:BS6). 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.

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How Fast Is Yangzijiang Shipbuilding (Holdings) Growing?

The market is a voting machine in the short term, but a weighing machine in the long term, so you'd expect share price to follow earnings per share (EPS) outcomes eventually. That makes EPS growth an attractive quality for any company. To the delight of shareholders, Yangzijiang Shipbuilding (Holdings) has achieved impressive annual EPS growth of 50%, compound, over the last three years. Growth that fast may well be fleeting, but it should be more than enough to pique the interest of the wary stock pickers.

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. Yangzijiang Shipbuilding (Holdings) shareholders can take confidence from the fact that EBIT margins are up from 24% to 30%, and revenue is growing. Both of which are great metrics to check off for potential growth.

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.

Check out our latest analysis for Yangzijiang Shipbuilding (Holdings)

In investing, as in life, the future matters more than the past. So why not check out this free interactive visualization of Yangzijiang Shipbuilding (Holdings)'s forecast profits?

Are Yangzijiang Shipbuilding (Holdings) Insiders Aligned With All Shareholders?

We would not expect to see insiders owning a large percentage of a S$13b company like Yangzijiang Shipbuilding (Holdings). But we are reassured by the fact they have invested in the company. Indeed, they have a considerable amount of wealth invested in it, currently valued at CN¥578m. This suggests that leadership will be very mindful of shareholders' interests when making decisions!

It's good to see that insiders are invested in the company, but are remuneration levels reasonable? A brief analysis of the CEO compensation suggests they are. The median total compensation for CEOs of companies similar in size to Yangzijiang Shipbuilding (Holdings), with market caps over CN¥57b, is around CN¥35m.

Yangzijiang Shipbuilding (Holdings)'s CEO took home a total compensation package of CN¥6.0m in the year prior to December 2024. First impressions seem to indicate a compensation policy that is favourable to shareholders. While the level of CEO compensation shouldn't be the biggest factor in how the company is viewed, modest remuneration is a positive, because it suggests that the board keeps shareholder interests in mind. It can also be a sign of good governance, more generally.

Does Yangzijiang Shipbuilding (Holdings) Deserve A Spot On Your Watchlist?

Yangzijiang Shipbuilding (Holdings)'s earnings per share growth have been climbing higher at an appreciable rate. The cherry on top is that insiders own a bucket-load of shares, and the CEO pay seems really quite reasonable. The strong EPS improvement suggests the businesses is humming along. Yangzijiang Shipbuilding (Holdings) is certainly doing some things right and is well worth investigating. It is worth noting though that we have found 1 warning sign for Yangzijiang Shipbuilding (Holdings) that you need to take into consideration.

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 Singaporean 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.

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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.