Our Stock Scan for Earnings Growth, Abu Dhabi Islamic Bank PJSC (ADX:ADIB) Passes Easily

Investors are often led by the idea of ​​discovering the “next big thing,” even if it means buying “story stocks” without any revenue, let alone profit. Unfortunately, these high-risk investments often have little chance of paying off, and many investors pay the price to learn their lesson. While a well-funded company may continue to lose money for years, it ultimately needs to generate profits, or investors will move on and the company dies.

Despite the blue-sky era of investing in tech stocks, many investors still employ a more traditional strategy; buying shares of profitable companies such as Abu Dhabi Islamic Bank PJSC (ADX: ADIB). Now this is not to say that this company presents the best investment opportunity, but profitability is a key component of business success.

See our latest analysis for Abu Dhabi Islamic Bank PJSC

How fast is Abu Dhabi Islamic Bank PJSC growing?

The market is a voting machine in the short run, but a weighing machine in the long run, so you expect the share price to eventually follow the earnings per share (EPS) result. Therefore, there are many investors who like to buy stocks of companies with EPS growth. Impressively, Abu Dhabi Islamic Bank PJSC has grown earnings per share at a compound annual rate of 23% over the past three years. If growth like this continues into the future, shareholders will be in for a treat.

It is often helpful to look at earnings before interest and taxes (EBIT) margins, as well as revenue growth, to provide another perspective on the quality of a company’s growth. Not all of Abu Dhabi Islamic Bank PJSC’s earnings this year are earnings from operation, so keep in mind that the revenue and margin figures used in this article may not be the best representation of the underlying business. Abu Dhabi Islamic Bank PJSC maintained a stable EBIT margin last year, while revenue rose 42% to د.إ6.7b. This is progress.

You can view the company’s revenue and earnings growth trends in the table below. To see actual numbers, click on the graph.

As an investor, the trick is to find those about to Be good in the future, not just the past.Although the crystal ball does not exist, you can view the A visualization of our consensus analyst forecasts for Abu Dhabi Islamic Bank PJSC’s future EPS 100% free.

Are Abu Dhabi Islamic Bank PJSC insiders aligned with all shareholders?

Due to the size of Abu Dhabi Islamic Bank PJSC, we do not expect insiders to own a large percentage of the company. But we’re reassured by the fact that they invested in the company. We note that their sizeable stake in the company is worth $662 million. This shows that leaders pay great attention to the interests of shareholders when making decisions!

Is Abu Dhabi Islamic Bank PJSC worth watching?

You can’t deny that Abu Dhabi Islamic Bank PJSC’s earnings per share growth has been phenomenal. It’s fascinating. This kind of EPS growth rate is something the company should be proud of, so it’s no surprise that insiders own a sizable chunk of the stock. On its merits, solid EPS growth and company insiders aligning with shareholders suggest this is a business worth looking into further.However, before you get too excited we found out 2 warning signs for Abu Dhabi Islamic Bank PJSC (1 is a bit unpleasant!) You should know.

While Abu Dhabi Islamic Bank PJSC does look good, it could attract more investors if insiders buy shares.If you love seeing insider buying then this free List of Growth Companies to Buy by Insidersmay be just what you’re looking for.

Please note that insider trading discussed in this article refers to reportable transactions in the relevant jurisdictions.

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This article by Simply Wall St is general in nature. We use only an unbiased methodology to provide reviews based on historical data and analyst forecasts, 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 objectives or your financial situation. Our goal is 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 qualitative material. Simply Wall St has no positions in any of the stocks mentioned.