If EPS Growth Matters to You, Computer Partners Group (HKG:1263) Presents an Opportunity | Biden News

It is common for many investors, especially those who are inexperienced, to buy shares in companies with a good story even if these companies are losing. Sometimes these stories can cloud the minds of investors, causing them to invest on their emotions rather than on the merit of good companies. Unprofitable companies are always racing against time to achieve financial sustainability, so investors in these companies may be taking on more risk than they should.

So if this high-risk, high-reward idea doesn’t sit well, you might be more interested in profitable, growing companies like Computer Partnership Group (HKG:1263). Although profit is not the only metric to consider when investing, it is worth recognizing businesses that can consistently produce it.

Our analysis indicates that 1263 is possibly an underestimate!

PC Partner Group Enhancement Benefits

In the last three years the income per share of PC Partner Group took off; so much so that it is somewhat disingenuous to use these figures to try to deduce long-term valuations. So it would be better to isolate the growth rate over the last year for our analysis. Notably, PC Partner Group’s EPS shot from HK$2.96 to HK$5.79, over the last year. It’s rare to see 96% year-over-year growth like that. The best case scenario? That the business has hit a real inflection point.

It is often useful to look at earnings before interest and tax (EBIT) margins, as well as revenue growth, to get another perspective on the quality of the company’s growth. The good news is that PC Partner Group is growing revenues, and EBIT margins have improved by 7.8 percentage points to 19%, over the last year. Both are great metrics to monitor for potential growth.

You can look at the company’s income and revenue growth trend, in the chart below. Click on the chart to see the exact numbers.

Since PC Partner Group is not a giant, with a market capitalization of HK$1.7 billion, you should definitely check its cash and debt. before getting too excited about its prospects.

Are PC Partner Group Insiders Compatible with All Shareholders?

Theory would suggest that it is an encouraging sign to see high insider ownership of a company because it ties a company directly to the financial success of its management. So as you can imagine, the fact that PC Partner Group insiders own a significant number of shares is certainly attractive. In fact, they own 49% of the shares, making insiders a very influential shareholder group. This should be a welcome sign for investors because it suggests that the people who make the decisions are also influenced by their choices. To give you an idea, the value of insiders’ holdings in the business is estimated at HK$857 million at the current share price. That should be more than enough to keep them focused on creating shareholder value!

Is A Computer Affiliate Group Worth Watching?

PC Partner Group’s earnings per share growth climbed higher at a remarkable pace. Such growth is nothing short of eye-popping, and the large investment held by insiders should certainly brighten the company’s outlook. The hope is, of course, that the strong growth marks a fundamental improvement in the business economy. Based on the sum of its parts, we definitely think it’s worth taking a very close look at PC Partner Group. However, before you get too excited, we’ve found out 2 warning signs for PC Partner Group that you should be aware of.

There is always the possibility to do well to buy shares that it is not growing incomes and no have insiders buying stock. But for those who consider these important measures, we encourage you to check out those companies do has those characteristics. You can access a free list of them here.

Please note that the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction.

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This Simply Wall St article 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 into account your goals, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not take into account the latest price-sensitive company announcements or quality material. Simply Wall St has no position in any stocks mentioned.