Yahoo Finance If EPS Growth Is Important To You, Tiong Nam Logistics Holdings Berhad (KLSE:TNLOGIS) Presents An Opportunity
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 can act like a sponge for capital - so investors should be cautious that they're not throwing good money after bad.
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 Tiong Nam Logistics Holdings Berhad (KLSE:TNLOGIS). 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.
View our latest analysis for Tiong Nam Logistics Holdings Berhad
Tiong Nam Logistics Holdings Berhad's Improving Profits
Strong earnings per share (EPS) results are an indicator of a company achieving solid profits, which investors look upon favourably and so the share price tends to reflect great EPS performance. So a growing EPS generally brings attention to a company in the eyes of prospective investors. It's an outstanding feat for Tiong Nam Logistics Holdings Berhad to have grown EPS from RM0.0089 to RM0.14 in just one year. When you see earnings grow that quickly, it often means good things ahead for the company.
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. Tiong Nam Logistics Holdings Berhad shareholders can take confidence from the fact that EBIT margins are up from 9.3% to 22%, and revenue is growing. Both of which are great metrics to check off for potential growth.
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.
Since Tiong Nam Logistics Holdings Berhad is no giant, with a market capitalisation of RM391m, you should definitely check its cash and debt before getting too excited about its prospects.
Are Tiong Nam Logistics Holdings Berhad Insiders Aligned With All Shareholders?
It's a necessity that company leaders act in the best interest of shareholders and so insider investment always comes as a reassurance to the market. So it is good to see that Tiong Nam Logistics Holdings Berhad insiders have a significant amount of capital invested in the stock. Indeed, they hold RM121m worth of its stock. That's a lot of money, and no small incentive to work hard. Those holdings account for over 31% of the company; visible skin in the game.
Does Tiong Nam Logistics Holdings Berhad Deserve A Spot On Your Watchlist?
Tiong Nam Logistics Holdings Berhad's earnings per share have been soaring, with growth rates sky high. That EPS growth certainly is attention grabbing, and the large insider ownership only serves to further stoke our interest. The hope is, of course, that the strong growth marks a fundamental improvement in the business economics. Based on the sum of its parts, we definitely think its worth watching Tiong Nam Logistics Holdings Berhad very closely. We don't want to rain on the parade too much, but we did also find 2 warning signs for Tiong Nam Logistics Holdings Berhad (1 doesn't sit too well with us!) that you need to be mindful of.
Although Tiong Nam Logistics Holdings Berhad 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 Malaysian 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.
