Tecnoglass currently trades at $70.28 per share and has shown little upside over the past six months, posting a middling return of 2.6%. However, the stock is beating the S&P 500’s 2.9% decline during that period.

Is TGLS a buy right now? Or is this an overvalued company? Find out in our full research report, it’s free.

Why Are We Positive On TGLS?

The first-ever Colombian company to trade on the NASDAQ, Tecnoglass (NYSE: TGLS) is a manufacturer of architectural glass, windows, and aluminum products.

1. Skyrocketing Revenue Shows Strong Momentum

A company’s long-term performance is an indicator of its overall quality. Any business can have short-term success, but a top-tier one grows for years. Luckily, Tecnoglass’s sales grew at an incredible 15.6% compounded annual growth rate over the last five years. Its growth surpassed the average industrials company and shows its offerings resonate with customers.

2. Operating Margin Reveals a Well-Run Organization

Operating margin is a key measure of profitability. Think of it as net income - the bottom line - excluding the impact of taxes and interest on debt, which are less connected to business fundamentals.

Tecnoglass has been a well-oiled machine over the last five years. It demonstrated elite profitability for an industrials business, boasting an average operating margin of 27%. This result isn’t surprising as its high gross margin gives it a favorable starting point.

3. Outstanding Long-Term EPS Growth

Analyzing the long-term change in earnings per share (EPS) shows whether a company's incremental sales were profitable – for example, revenue could be inflated through excessive spending on advertising and promotions.

Tecnoglass’s EPS grew at an astounding 39.8% compounded annual growth rate over the last five years, higher than its 15.6% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.

Final Judgment

These are just a few reasons why we think Tecnoglass is a high-quality business, and with its recent outperformance amid a softer market environment, the stock trades at 16.7× forward price-to-earnings (or $70.28 per share). Is now the time to initiate a position? See for yourself in our comprehensive research report, it’s free.

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