For beginners, it may be tempting to invest in a company with a compelling story, even if it lacks a proven track record of revenue and profit. However, as investing guru Peter Lynch once said, “Long shots almost never pay off.” Loss-making companies are constantly working against time to become financially sustainable, posing a higher risk for investors.
If you prefer a more stable option, profitable and growing companies like Mondelez International (NASDAQ:MDLZ) might be more appealing. While the company may be fairly valued by the market, consistent profits can continue to benefit shareholders in the long run.
Mondelez International has seen a 6.4% growth in earnings per share (EPS) over the past three years, indicating steady progress. Additionally, the company has shown revenue growth and improved earnings before interest and taxation (EBIT) margins, which are positive signs of sustained growth.
Insiders at Mondelez International have a significant investment in the company, valued at US$131 million, despite owning only 0.1% of the company. This alignment with shareholders suggests that company management is motivated to deliver favorable outcomes.
Considering its profitable growth and insider ownership, Mondelez International could be worth keeping an eye on. However, investors should be aware of any potential risks, including the 1 warning sign identified for the company.
While there is always a chance of success with stocks that are not growing earnings or lack insider buying, it may be beneficial to explore companies that exhibit these characteristics. Ultimately, it is essential to conduct thorough research and analysis before making any investment decisions.
As a general disclaimer, this article by Simply Wall St is based on historical data and analyst forecasts, using an unbiased methodology. It is not intended as financial advice and does not consider individual objectives or financial situations. Simply Wall St aims to provide long-term focused analysis driven by fundamental data, without factoring in the latest price-sensitive company announcements or qualitative material.