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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.' A loss-making company is yet to prove itself with profit, and eventually the inflow of external capital may dry up.
In contrast to all that, many investors prefer to focus on companies like Firan Technology Group (TSE:FTG), 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 Firan Technology Group with the means to add long-term value to shareholders.
View our latest analysis for Firan Technology Group
How Fast Is Firan Technology Group Growing Its Earnings Per Share?
Firan Technology Group has undergone a massive growth in earnings per share over the last three years. So much so that this three year growth rate wouldn't be a fair assessment of the company's future. So it would be better to isolate the growth rate over the last year for our analysis. Firan Technology Group boosted its trailing twelve month EPS from CA$0.35 to CA$0.43, in the last year. There's little doubt shareholders would be happy with that 21% gain.
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. EBIT margins for Firan Technology Group remained fairly unchanged over the last year, however the company should be pleased to report its revenue growth for the period of 32% to CA$157m. That's a real positive.
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.
Firan Technology Group isn't a huge company, given its market capitalisation of CA$177m. That makes it extra important to check on its balance sheet strength.
Are Firan Technology Group Insiders Aligned With All Shareholders?
Investors are always searching for a vote of confidence in the companies they hold and insider buying is one of the key indicators for optimism on the market. 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 Firan Technology Group insiders spent CA$168k on stock, over the last year; in contrast, we didn't see any selling. That paints the company in a nice light, as it signals that its leaders are feeling confident in where the company is heading. We also note that it was the President, Bradley Bourne, who made the biggest single acquisition, paying CA$65k for shares at about CA$4.97 each.