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. Unfortunately, these high risk investments often have little probability of ever paying off, and many investors pay a price to learn their lesson. Loss making companies can act like a sponge for capital – so investors should be cautious that they’re not throwing good money after bad.
In contrast to all that, many investors prefer to focus on companies like Canon Marketing Japan (TSE:8060), which has not only revenues, but also profits. Even if this company is fairly valued by the market, investors would agree that generating consistent profits will continue to provide Canon Marketing Japan with the means to add long-term value to shareholders.
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How Quickly Is Canon Marketing Japan Increasing Earnings Per Share?
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. Therefore, there are plenty of investors who like to buy shares in companies that are growing EPS. Canon Marketing Japan managed to grow EPS by 17% per year, over three years. That growth rate is fairly good, assuming the company can keep it up. Getting in to the the finer details, it important to know that the EPS growth has been helped by share buybacks, demonstrating that the business is positioned to return capital to its shareholders.
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. Canon Marketing Japan maintained stable EBIT margins over the last year, all while growing revenue 7.3% to JP¥654b. That’s a real positive.
You can take a look at the company’s revenue and earnings growth trend, in the chart below. Click on the chart to see the exact numbers.
TSE:8060 Earnings and Revenue History April 20th 2025
See our latest analysis for Canon Marketing Japan
Fortunately, we’ve got access to analyst forecasts of Canon Marketing Japan’s future profits. You can do your own forecasts without looking, or you can take a peek at what the professionals are predicting.
Are Canon Marketing Japan Insiders Aligned With All Shareholders?
Prior to investment, it’s always a good idea to check that the management team is paid reasonably. Pay levels around or below the median, can be a sign that shareholder interests are well considered. For companies with market capitalisations between JP¥284b and JP¥910b, like Canon Marketing Japan, the median CEO pay is around JP¥145m.
The Canon Marketing Japan CEO received JP¥112m in compensation for the year ending December 2023. That comes in below the average for similar sized companies and seems pretty reasonable. While the level of CEO compensation shouldn’t be the biggest factor in how the company is viewed, modest remuneration is a positive, because it suggests that the board keeps shareholder interests in mind. Generally, arguments can be made that reasonable pay levels attest to good decision-making.
Is Canon Marketing Japan Worth Keeping An Eye On?
One important encouraging feature of Canon Marketing Japan is that it is growing profits. Not only that, but the CEO is paid quite reasonably, which should prompt investors to feel more trusting of the board of directors. All things considered, Canon Marketing Japan is definitely worth taking a deeper dive into. You still need to take note of risks, for example – Canon Marketing Japan has 1 warning sign we think you should be aware 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 Japanese 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.
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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.
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