January 17, 2022

Remarkable Mate

Remarkable business & finance

If You Like EPS Growth Then Check Out JELD-WEN Holding (NYSE:JELD) Before It’s Too Late

Some have more dollars than sense, they say, so even companies that have no revenue, no profit, and a record of falling short, can easily find investors. And in their study titled Who Falls Prey to the Wolf of Wall Street?’ Leuz et. al. found that it is ‘quite common’ for investors to lose money by buying into ‘pump and dump’ schemes.

So if you’re like me, you might be more interested in profitable, growing companies, like JELD-WEN Holding (NYSE:JELD). While profit is not necessarily a social good, it’s easy to admire a business that can consistently produce it. Conversely, a loss-making company is yet to prove itself with profit, and eventually the sweet milk of external capital may run sour.

View our latest analysis for JELD-WEN Holding

How Fast Is JELD-WEN Holding Growing Its Earnings Per Share?

In a capitalist society capital chases profits, and that means share prices tend rise with earnings per share (EPS). So like the hint of a smile on a face that I love, growing EPS generally makes me look twice. It is therefore awe-striking that JELD-WEN Holding’s EPS went from US$0.56 to US$1.86 in just one year. Even though that growth rate is unlikely to be repeated, that looks like a breakout improvement.

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. JELD-WEN Holding maintained stable EBIT margins over the last year, all while growing revenue 12% to US$4.6b. That’s progress.

In the chart below, you can see how the company has grown earnings, and revenue, over time. Click on the chart to see the exact numbers.

NYSE:JELD Earnings and Revenue History January 9th 2022

You don’t drive with your eyes on the rear-view mirror, so you might be more interested in this free report showing analyst forecasts for JELD-WEN Holding’s future profits.

Are JELD-WEN Holding Insiders Aligned With All Shareholders?

I like company leaders to have some skin in the game, so to speak, because it increases alignment of incentives between the people running the business, and its true owners. As a result, I’m encouraged by the fact that insiders own JELD-WEN Holding shares worth a considerable sum. Given insiders own a small fortune of shares, currently valued at US$94m, they have plenty of motivation to push the business to succeed. That’s certainly enough to make me think that management will be very focussed on long term growth.

Does JELD-WEN Holding Deserve A Spot On Your Watchlist?

JELD-WEN Holding’s earnings per share have taken off like a rocket aimed right at the moon. That sort of growth is nothing short of eye-catching, and the large investment held by insiders certainly brightens my view of the company. The hope is, of course, that the strong growth marks a fundamental improvement in the business economics. So yes, on this short analysis I do think it’s worth considering JELD-WEN Holding for a spot on your watchlist. However, before you get too excited we’ve discovered 2 warning signs for JELD-WEN Holding (1 is potentially serious!) that you should be aware of.

You can invest in any company you want. But if you prefer to focus on stocks that have demonstrated insider buying, here is a list of companies with insider buying in the last three months.

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

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.

https://simplywall.st/stocks/us/capital-goods/nyse-jeld/jeld-wen-holding/news/if-you-like-eps-growth-then-check-out-jeld-wen-holding-nysej