Does CETIS Graphic and Documentation Services d.d (LJSE:CETG) Deserve A Spot On Your Watchlist?

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. 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.

In contrast to all that, many investors prefer to focus on companies like CETIS Graphic and Documentation Services d.d (LJSE:CETG), which has not only revenues, but also profits. Even if this company is fairly valued by the market, investors would agree that generating consistent profits will continue to provide CETIS Graphic and Documentation Services d.d with the means to add long-term value to shareholders.

View our latest analysis for CETIS Graphic and Documentation Services d.d

How Quickly Is CETIS Graphic and Documentation Services d.d Increasing Earnings Per Share?

If a company can keep growing earnings per share (EPS) long enough, its share price should eventually follow. That means EPS growth is considered a real positive by most successful long-term investors. Recognition must be given to the that CETIS Graphic and Documentation Services d.d has grown EPS by 43% per year, over the last three years. That sort of growth rarely ever lasts long, but it is well worth paying attention to when it happens.

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. The good news is that CETIS Graphic and Documentation Services d.d is growing revenues, and EBIT margins improved by 4.9 percentage points to 15%, over the last year. 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. Click on the chart to see the exact numbers.

Since CETIS Graphic and Documentation Services d.d is no giant, with a market capitalisation of €71m, you should definitely check its cash and debt before getting too excited about its prospects.

Are CETIS Graphic and Documentation Services d.d Insiders Aligned With All Shareholders?

Prior to investment, it's always a good idea to check that the management team is paid reasonably. Pay levels around or below the median, can be a sign that shareholder interests are well considered. For companies with market capitalisations under €182m, like CETIS Graphic and Documentation Services d.d, the median CEO pay is around €186k.

CETIS Graphic and Documentation Services d.d offered total compensation worth €133k to its CEO in the year to December 2021. That comes in below the average for similar sized companies and seems pretty reasonable. CEO remuneration levels are not the most important metric for investors, but when the pay is modest, that does support enhanced alignment between the CEO and the ordinary shareholders. Generally, arguments can be made that reasonable pay levels attest to good decision-making.

Does CETIS Graphic and Documentation Services d.d Deserve A Spot On Your Watchlist?

CETIS Graphic and Documentation Services d.d's earnings per share have been soaring, with growth rates sky high. This appreciable increase in earnings could be a sign of an upward trajectory for the company. At the same time the reasonable CEO compensation reflects well on the board of directors. So faced with these facts, it seems that researching this stock a little more may lead you to discover an investment opportunity that meets your quality standards. You still need to take note of risks, for example - CETIS Graphic and Documentation Services d.d has 5 warning signs (and 1 which shouldn't be ignored) we think you should know about.

Although CETIS Graphic and Documentation Services d.d 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.