Yahoo Finance Is Now The Time To Put Jaya Tiasa Holdings Berhad (KLSE:JTIASA) On Your Watchlist?
The excitement of investing in a company that can reverse its fortunes is a big draw for some speculators, so even companies that have no revenue, no profit, and a record of falling short, can manage to find investors. 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. 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 Jaya Tiasa Holdings Berhad (KLSE:JTIASA). While this doesn't necessarily speak to whether it's undervalued, the profitability of the business is enough to warrant some appreciation - especially if its growing.
See our latest analysis for Jaya Tiasa Holdings Berhad
How Fast Is Jaya Tiasa Holdings Berhad Growing?
If you believe that markets are even vaguely efficient, then over the long term you'd expect a company's share price to follow its earnings per share (EPS) outcomes. So it makes sense that experienced investors pay close attention to company EPS when undertaking investment research. To the delight of shareholders, Jaya Tiasa Holdings Berhad has achieved impressive annual EPS growth of 55%, compound, 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. EBIT margins for Jaya Tiasa Holdings Berhad remained fairly unchanged over the last year, however the company should be pleased to report its revenue growth for the period of 12% to RM1b. That's a real positive.
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 Jaya Tiasa Holdings Berhad is no giant, with a market capitalisation of RM1.0b, you should definitely check its cash and debt before getting too excited about its prospects.
Are Jaya Tiasa Holdings Berhad Insiders Aligned With All Shareholders?
It's pleasing to see company leaders with putting their money on the line, so to speak, because it increases alignment of incentives between the people running the business, and its true owners. Shareholders will be pleased by the fact that insiders own Jaya Tiasa Holdings Berhad shares worth a considerable sum. Indeed, they hold RM59m worth of its stock. That's a lot of money, and no small incentive to work hard. As a percentage, this totals to 5.8% of the shares on issue for the business, an appreciable amount considering the market cap.
Does Jaya Tiasa Holdings Berhad Deserve A Spot On Your Watchlist?
Jaya Tiasa Holdings Berhad's earnings have taken off in quite an impressive fashion. 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. So at the surface level, Jaya Tiasa Holdings Berhad is worth putting on your watchlist; after all, shareholders do well when the market underestimates fast growing companies. However, before you get too excited we've discovered 2 warning signs for Jaya Tiasa Holdings Berhad (1 makes us a bit uncomfortable!) that you should be aware of.
There's always the possibility of doing well buying stocks that are not growing earnings and do not have insiders buying shares. But for those who consider these important metrics, we encourage you to check out companies that do have those features. You can access a tailored list of Malaysian companies which have demonstrated growth backed by significant insider holdings.
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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com
