Yahoo Finance With EPS Growth And More, Stabilis Solutions (NASDAQ:SLNG) Makes An Interesting Case
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. 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.
So if this idea of high risk and high reward doesn't suit, you might be more interested in profitable, growing companies, like Stabilis Solutions (NASDAQ:SLNG). 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 Stabilis Solutions
How Fast Is Stabilis Solutions Growing Its Earnings Per Share?
In the last three years Stabilis Solutions' earnings per share took off; so much so that it's a bit disingenuous to use these figures to try and deduce long term estimates. So it would be better to isolate the growth rate over the last year for our analysis. Impressively, Stabilis Solutions' EPS catapulted from US$0.014 to US$0.027, over the last year. It's a rarity to see 101% year-on-year growth like that.
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. The previous 12 months are something that Stabilis Solutions will want to put behind them after seeing a drop in EBIT margin and revenue for the period. This is less than stellar for the company.
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.
Stabilis Solutions isn't a huge company, given its market capitalisation of US$75m. That makes it extra important to check on its balance sheet strength.
Are Stabilis Solutions Insiders Aligned With All Shareholders?
It's said that there's no smoke without fire. For investors, insider buying is often the smoke that indicates which stocks could set the market alight. Because often, the purchase of stock is a sign that the buyer views it as undervalued. Of course, we can never be sure what insiders are thinking, we can only judge their actions.
We note that Stabilis Solutions insiders spent US$79k on stock, over the last year; in contrast, we didn't see any selling. That's nice to see, because it suggests insiders are optimistic. It is also worth noting that it was Independent Director Matthew Morris who made the biggest single purchase, worth US$27k, paying US$3.51 per share.
Should You Add Stabilis Solutions To Your Watchlist?
Stabilis Solutions' earnings have taken off in quite an impressive fashion. Growth-minded people will be intrigued by the incredible movement in EPS growth. And may very well signal a significant inflection point for the business. If this is the case, then keeping a watch over Stabilis Solutions could be in your best interest. It is worth noting though that we have found 2 warning signs for Stabilis Solutions that you need to take into consideration.
The good news is that Stabilis Solutions is not the only growth stock with insider buying. Here's a list of growth-focused companies in the US with insider buying in the last three months!
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.
