The excitement of investing in a company that can reverse its fortunes is a big draw for some speculators, so even companies that have no revenue, no profit, and a record of falling short, can manage to find investors. 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.

Despite being in the age of tech-stock blue-sky investing, many investors still adopt a more traditional strategy; buying shares in profitable companies like ValueMax Group (SGX:T6I). While this doesn't necessarily speak to whether it's undervalued, the profitability of the business is enough to warrant some appreciation - especially if its growing.

View our latest analysis for ValueMax Group

How Fast Is ValueMax Group Growing?

Generally, companies experiencing growth in earnings per share (EPS) should see similar trends in share price. That makes EPS growth an attractive quality for any company. We can see that in the last three years ValueMax Group grew its EPS by 6.7% per year. While that sort of growth rate isn't anything to write home about, it does show the business is growing.

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. EBIT margins for ValueMax Group remained fairly unchanged over the last year, however the company should be pleased to report its revenue growth for the period of 43% to S$409m. That's encouraging news for the company!

You can take a look at the company's revenue and earnings growth trend, in the chart below. To see the actual numbers, click on the chart.

ValueMax Group isn't a huge company, given its market capitalisation of S$356m. That makes it extra important to check on its balance sheet strength.

Are ValueMax Group Insiders Aligned With All Shareholders?

It's said that there's no smoke without fire. For investors, insider buying is often the smoke that indicates which stocks could set the market alight. Because often, the purchase of stock is a sign that the buyer views it as undervalued. Of course, we can never be sure what insiders are thinking, we can only judge their actions.

The good news for ValueMax Group is that one insider has illustrated their belief in the company's future with a huge purchase of shares in the last 12 months. In one big hit, Executive Chairman Hiang Nam Yeah paid S$330k, for shares at an average price of S$0.35 per share. Big insider buys like that are a rarity and should prompt discussion on the merits of the business.