U.S. Markets close in 5 hrs 30 mins
  • S&P 500

    4,231.67
    +30.05 (+0.72%)
     
  • Dow 30

    34,692.38
    +143.85 (+0.42%)
     
  • Nasdaq

    13,802.01
    +169.17 (+1.24%)
     
  • Russell 2000

    2,264.18
    +22.76 (+1.02%)
     
  • Crude Oil

    64.80
    +0.09 (+0.14%)
     
  • Gold

    1,838.60
    +22.90 (+1.26%)
     
  • Silver

    27.48
    -0.00 (-0.01%)
     
  • EUR/USD

    1.2146
    +0.0078 (+0.6437%)
     
  • 10-Yr Bond

    1.5290
    -0.0320 (-2.05%)
     
  • Vix

    17.72
    -0.67 (-3.64%)
     
  • GBP/USD

    1.3963
    +0.0071 (+0.5097%)
     
  • USD/JPY

    108.5320
    -0.5530 (-0.5069%)
     
  • BTC-USD

    57,067.93
    -162.85 (-0.28%)
     
  • CMC Crypto 200

    1,510.40
    +74.62 (+5.20%)
     
  • FTSE 100

    7,139.47
    +63.30 (+0.89%)
     
  • Nikkei 225

    29,357.82
    +26.45 (+0.09%)
     

Should You Be Adding Brandywine Realty Trust (NYSE:BDN) To Your Watchlist Today?

  • Oops!
    Something went wrong.
    Please try again later.
Simply Wall St
·4 min read
  • Oops!
    Something went wrong.
    Please try again later.

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. Unfortunately, high risk investments often have little probability of ever paying off, and many investors pay a price to learn their lesson.

If, on the other hand, you like companies that have revenue, and even earn profits, then you may well be interested in Brandywine Realty Trust (NYSE:BDN). While that doesn't make the shares worth buying at any price, you can't deny that successful capitalism requires profit, eventually. While a well funded company may sustain losses for years, unless its owners have an endless appetite for subsidizing the customer, it will need to generate a profit eventually, or else breathe its last breath.

View our latest analysis for Brandywine Realty Trust

Brandywine Realty Trust's Earnings Per Share Are Growing.

As one of my mentors once told me, share price follows earnings per share (EPS). It's no surprise, then, that I like to invest in companies with EPS growth. I, for one, am blown away by the fact that Brandywine Realty Trust has grown EPS by 39% per year, over the last three years. Growth that fast may well be fleeting, but like a lotus blooming from a murky pond, it sparks joy for the wary stock pickers.

I like to see top-line growth as an indication that growth is sustainable, and I look for a high earnings before interest and taxation (EBIT) margin to point to a competitive moat (though some companies with low margins also have moats). Brandywine Realty Trust's EBIT margins are flat but, of some concern, its revenue is actually down. And that does make me a little more cautious of the stock.

The chart below shows how the company's bottom and top lines have progressed over time. For finer detail, click on the image.

earnings-and-revenue-history
earnings-and-revenue-history

The trick, as an investor, is to find companies that are going to perform well in the future, not just in the past. To that end, right now and today, you can check our visualization of consensus analyst forecasts for future Brandywine Realty Trust EPS 100% free.

Are Brandywine Realty Trust Insiders Aligned With All Shareholders?

It makes me feel more secure owning shares in a company if insiders also own shares, thusly more closely aligning our interests. So it is good to see that Brandywine Realty Trust insiders have a significant amount of capital invested in the stock. To be specific, they have US$37m worth of shares. That shows significant buy-in, and may indicate conviction in the business strategy. Even though that's only about 1.7% of the company, it's enough money to indicate alignment between the leaders of the business and ordinary shareholders.

Should You Add Brandywine Realty Trust To Your Watchlist?

Brandywine Realty Trust'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. At times fast EPS growth is a sign the business has reached an inflection point; and I do like those. So yes, on this short analysis I do think it's worth considering Brandywine Realty Trust for a spot on your watchlist. You still need to take note of risks, for example - Brandywine Realty Trust has 4 warning signs (and 2 which are a bit unpleasant) we think you should know about.

Of course, you can do well (sometimes) buying stocks that are not growing earnings and do not have insiders buying shares. But as a growth investor I always like to check out companies that do have those features. You can access a free list of them here.

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. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.