It's common for many investors, especially those who are inexperienced, to buy shares in companies with a good story even if these companies are loss-making. Sometimes these stories can cloud the minds of investors, leading them to invest with their emotions rather than on the merit of good company fundamentals. 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 AXIS Capital Holdings (NYSE:AXS). While profit isn't the sole metric that should be considered when investing, it's worth recognising businesses that can consistently produce it.
AXIS Capital Holdings' Earnings Per Share Are 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. Recognition must be given to the that AXIS Capital Holdings has grown EPS by 55% per year, over the last three years. That sort of growth rarely ever lasts long, but it is well worth paying attention to when it happens.
Careful consideration of revenue growth and earnings before interest and taxation (EBIT) margins can help inform a view on the sustainability of the recent profit growth. AXIS Capital Holdings shareholders can take confidence from the fact that EBIT margins are up from 5.6% to 11%, and revenue is growing. Ticking those two boxes is a good sign of growth, in our book.
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.
NYSE:AXS Earnings and Revenue History June 20th 2024
Fortunately, we've got access to analyst forecasts of AXIS Capital Holdings' future profits. You can do your own forecasts without looking, or you can take a peek at what the professionals are predicting.
Are AXIS Capital Holdings Insiders Aligned With All Shareholders?
Since AXIS Capital Holdings has a market capitalisation of US$6.0b, we wouldn't expect insiders to hold a large percentage of shares. But we are reassured by the fact they have invested in the company. Indeed, they hold US$38m worth of its stock. That shows significant buy-in, and may indicate conviction in the business strategy. While their ownership only accounts for 0.6%, this is still a considerable amount at stake to encourage the business to maintain a strategy that will deliver value to shareholders.
It means a lot to see insiders invested in the business, but shareholders may be wondering if remuneration policies are in their best interest. Our quick analysis into CEO remuneration would seem to indicate they are. Our analysis has discovered that the median total compensation for the CEOs of companies like AXIS Capital Holdings with market caps between US$4.0b and US$12b is about US$8.5m.
AXIS Capital Holdings offered total compensation worth US$6.8m to its CEO in the year to December 2023. That seems pretty reasonable, especially given it's below the median for similar sized companies. CEO remuneration levels are not the most important metric for investors, but when the pay is modest, that does support enhanced alignment between the CEO and the ordinary shareholders. It can also be a sign of a culture of integrity, in a broader sense.
Should You Add AXIS Capital Holdings To Your Watchlist?
AXIS Capital Holdings' earnings have taken off in quite an impressive fashion. An added bonus for those interested is that management hold a heap of stock and the CEO pay is quite reasonable, illustrating good cash management. The sharp increase in earnings could signal good business momentum. Big growth can make big winners, so the writing on the wall tells us that AXIS Capital Holdings is worth considering carefully. We don't want to rain on the parade too much, but we did also find 1 warning sign for AXIS Capital Holdings that you need to be mindful 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 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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
许多投资者,尤其是那些缺乏经验的投资者,通常会购买那些有好故事的公司的股票,即使这些公司是亏损的。有时,这些故事会使投资者的思想蒙上阴影,导致他们用自己的情感进行投资,而不是根据良好的公司基本面进行投资。尽管资金充足的公司可能会遭受多年的亏损,但它最终需要盈利,否则投资者将继续前进,公司将萎缩。
因此,如果这种高风险和高回报的想法不适合,那么你可能会对盈利、成长中的公司更感兴趣,例如AXIS Capital Holdings(纽约证券交易所代码:AXS)。尽管利润不是投资时应考虑的唯一指标,但值得表彰能够持续生产利润的企业。
AXIS Capital Holdings的每股收益正在增长
如果你认为市场的效率甚至含糊不清,那么从长远来看,你预计公司的股价将遵循其每股收益(EPS)的结果。因此,经验丰富的投资者在进行投资研究时密切关注公司的每股收益是有道理的。必须认识到,在过去三年中,AXIS Capital Holdings的每股收益每年增长55%。这种增长很少持续很长时间,但是当它发生时,值得关注。
仔细考虑收入增长和息税前收益(EBIT)利润率有助于为近期利润增长的可持续性提供信息。AXIS Capital Holdings的股东可以从息税前利润率从5.6%上升到11%,收入也在增长这一事实中获得信心。在我们的书中,勾选这两个方框是增长的好兆头。
您可以在下图中查看该公司的收入和收益增长趋势。要获得更详细的细节,请点击图片。
纽约证券交易所:AXS 收益和收入历史记录 2024 年 6 月 20 日
幸运的是,我们可以获得分析师对AXIS Capital Holdings未来利润的预测。你可以不用看就自己做预测,也可以偷看专业人士的预测。
AXIS Capital Holdings内部人士是否与所有股东一致?
由于AXIS Capital Holdings的市值为60亿美元,我们预计内部人士不会持有很大比例的股票。但是他们投资了该公司,这让我们感到放心。事实上,他们持有价值3800万美元的股票。这表明了大量的支持,也可能表明对业务战略的信念。尽管他们的所有权仅占0.6%,但要鼓励企业维持为股东创造价值的战略,这仍然是一个相当大的风险。
看到内部人士投资该业务意义重大,但股东们可能想知道薪酬政策是否符合他们的最大利益。我们对首席执行官薪酬的快速分析似乎表明确实如此。我们的分析发现,市值在40亿美元至120亿美元之间的AXIS Capital Holdings等公司的首席执行官的总薪酬中位数约为850万美元。
在截至2023年12月的一年中,安讯士资本控股向其首席执行官提供了价值680万美元的总薪酬。这似乎很合理,特别是考虑到它低于类似规模公司的中位数。首席执行官薪酬水平并不是投资者最重要的指标,但是当薪酬适度时,这确实支持加强首席执行官与普通股东之间的协调。从更广泛的意义上讲,它也可以是诚信文化的标志。
您是否应该将AXIS Capital Holdings添加到您的关注清单中?
AXIS Capital Holdings的收益以令人印象深刻的方式实现了增长。对于那些感兴趣的人来说,额外的好处是,管理层持有大量股票,首席执行官的薪酬相当合理,这表明现金管理良好。收益的急剧增长可能预示着良好的业务势头。大幅增长可以造就大赢家,因此墙上的文字告诉我们,AXIS Capital Holdings值得仔细考虑。我们不想在游行队伍中下太多雨,但我们也为AXIS Capital Holdings找到了一个需要注意的警告信号。
买入收益不增长且没有内部人士购买股票的股票总是有可能表现良好。但是,对于那些考虑这些重要指标的人,我们鼓励您查看具有这些功能的公司。您可以访问量身定制的公司名单,这些公司在大量内部持股的支持下实现了增长。
请注意,本文中讨论的内幕交易是指相关司法管辖区内应报告的交易。
对这篇文章有反馈吗?对内容感到担忧吗?请直接联系我们。或者,也可以发送电子邮件至编辑团队 (at) simplywallst.com。
Simply Wall St的这篇文章本质上是笼统的。我们仅使用公正的方法根据历史数据和分析师的预测提供评论,我们的文章无意作为财务建议。它不构成买入或卖出任何股票的建议,也没有考虑到您的目标或财务状况。我们的目标是为您提供由基本数据驱动的长期重点分析。请注意,我们的分析可能不考虑最新的价格敏感型公司公告或定性材料。简而言之,华尔街没有持有任何上述股票的头寸。
对这篇文章有反馈吗?担心内容吗?直接联系我们。或者,发送电子邮件至 editorial-team@simplywallst.com