Here’s Why I Think Hilan (TLV:HLAN) Might Be Worth Your Attention Today
Like a puppy chasing its tail, some new investors are often looking for “the next big thing,” even if that means buying “history stocks” with no revenue, let alone profit. But as Peter Lynch said in One Up on Wall Street“Long shots almost never pay off.”
So if you’re like me, you might be more interested in profitable and growing businesses, like Hilan (TLV:HLAN). Now, I’m not saying the stock is necessarily undervalued today; but I can’t help but appreciate the profitability of the business itself. Conversely, a loss-making business has yet to prove itself with profits, and eventually the sweet milk of outside capital can turn sour.
Check out our latest analysis for Hilan
How fast is Hilan growing up?
The market is a short-term voting machine, but a long-term weighing machine, so stock price eventually follows earnings per share (EPS). This makes EPS growth an attractive quality for any business. We can see that over the past three years, Hilan has grown its EPS by 13% per year. That’s a pretty good rate, if the company can maintain it.
A careful look at revenue growth and earnings before interest and tax (EBIT) margins can help inform a view on the sustainability of recent earnings growth. While we note that Hilan’s EBIT margins have remained flat over the past year, revenue grew 8.0% to ₪1.8 billion. It is progress.
In the table below, you can see how the company has increased its profits and revenue over time. To see the actual numbers, click on the chart.
While it’s always good to see growing profits, you should always remember that a weak balance sheet could come back strong. So check the strength of Hilan’s balance sheet, before you get too excited.
Are Hilan insiders aligned with all shareholders?
I like that business leaders have some skin in the game, so to speak, because it increases the alignment of incentives between the people running the business and its true owners. So it’s good to see that Hilan insiders have significant capital invested in the stock. Notably, they have a huge stake in the company, worth ₪1.4 billion. This equates to 34% of the company, making insiders powerful and aligned with other shareholders. It may be my imagination, but I feel the glimmer of opportunity.
Should you add Hilan to your watch list?
As I mentioned before, Hilan is a growing company, which I like to see. If that’s not enough on its own, there are also the fairly notable levels of insider ownership. This combination appeals to me, to begin with. So yeah, I think the stock is worth watching. If you think Hilan might suit your style of investing, you can go straight to its annual report, or you can first check our discounted cash flow (DCF) assessment for the company.
Of course, you can (sometimes) buy stocks that are not increased income and not have insiders buying stocks. But as a growth investor, I always like to check out companies that do have these characteristics. You can access a free list of them here.
Please note that insider trading discussed in this article refers to reportable trading 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 unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.