I Built A List Of Growing Companies And Industrial and Commercial Bank of China (HKG:1398) Made The Cut
It’s only natural that many investors, especially those who are new to the game, prefer to buy shares in ‘sexy’ stocks with a good story, even if those businesses lose money. But the reality is that when a company loses money each year, for long enough, its investors will usually take their share of those losses. So if you’re like me, you might be more interested in profitable, growing companies, like Industrial and Commercial Bank of China (HKG:1398). While profit is not necessarily a social good, it’s easy to admire a business that can consistently produce it. Not all of Industrial and Commercial Bank of China’s revenue this year is revenue from operations, so keep in mind the revenue and margin numbers I’ve used might not be the best representation of the underlying business. I always like to check up on CEO compensation, because I think that reasonable pay levels, around or below the median, can be a sign that shareholder interests are well considered. For companies with market capitalizations over CN¥56b, like Industrial and Commercial Bank of China, the median CEO pay is around CN¥6.9m. Of course, just because Industrial and Commercial Bank of China is growing does not mean it is undervalued. If you’re wondering about the valuation, check out this gauge of its price-to-earnings ratio, as compared to its industry.