Investors are often guided by the idea of discovering 'the next big thing', even if that means buying 'story stocks' without any revenue, let alone profit. 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. Loss-making companies are always racing against time to reach financial sustainability, so investors in these companies may be taking on more risk than they should.

So if this idea of high risk and high reward doesn't suit, you might be more interested in profitable, growing companies, like Klingelnberg (VTX:KLIN). 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.

Check out our latest analysis for Klingelnberg

How Fast Is Klingelnberg Growing Its Earnings Per Share?

In the last three years Klingelnberg's earnings per share took off; so much so that it's a bit disingenuous to use these figures to try and deduce long term estimates. So it would be better to isolate the growth rate over the last year for our analysis. Klingelnberg's EPS has risen over the last 12 months, growing from €2.25 to €2.63. That's a 17% gain; respectable growth in the broader scheme of things.

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 Klingelnberg remained fairly unchanged over the last year, however the company should be pleased to report its revenue growth for the period of 15% to €277m. 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.

Klingelnberg isn't a huge company, given its market capitalisation of CHF159m. That makes it extra important to check on its balance sheet strength.

Are Klingelnberg Insiders Aligned With All Shareholders?

It's a necessity that company leaders act in the best interest of shareholders and so insider investment always comes as a reassurance to the market. Klingelnberg followers will find comfort in knowing that insiders have a significant amount of capital that aligns their best interests with the wider shareholder group. Indeed, they hold €12m worth of its stock. That shows significant buy-in, and may indicate conviction in the business strategy. That amounts to 7.7% of the company, demonstrating a degree of high-level alignment with shareholders.