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For beginners, it can seem like a good idea (and an exciting prospect) to buy a company that tells a good story to investors, even if it currently lacks a track record of revenue and profit. Unfortunately, these high risk investments often have little probability of ever paying off, and many investors pay a price to learn their lesson. 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.
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 ARYZTA (VTX:ARYN). Even if this company is fairly valued by the market, investors would agree that generating consistent profits will continue to provide ARYZTA with the means to add long-term value to shareholders.
See our latest analysis for ARYZTA
How Fast Is ARYZTA Growing Its Earnings Per Share?
In the last three years ARYZTA's 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. Thus, it makes sense to focus on more recent growth rates, instead. In impressive fashion, ARYZTA's EPS grew from €0.034 to €0.069, over the previous 12 months. It's a rarity to see 103% year-on-year growth like that.
It's often helpful to take a look at earnings before interest and tax (EBIT) margins, as well as revenue growth, to get another take on the quality of the company's growth. ARYZTA maintained stable EBIT margins over the last year, all while growing revenue 12% to €2.2b. That's progress.
You can take a look at the company's revenue and earnings growth trend, in the chart below. To see the actual numbers, click on the chart.
You don't drive with your eyes on the rear-view mirror, so you might be more interested in this free report showing analyst forecasts for ARYZTA's future profits.
Are ARYZTA 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 between €921m and €2.9b, like ARYZTA, the median CEO pay is around €1.2m.
The ARYZTA CEO received total compensation of just €337k in the year to July 2023. That looks like a modest pay packet, and may hint at a certain respect for the interests of 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.