Waterdrop: A Growing Company with Impressive EPS Growth and Strong Insider Investment

Waterdrop (NYSE:WDH) is a company with impressive annual EPS growth of 57% over the last three years. EBIT margins have grown from 1.1% to 7.4% in the last 12 months, and revenues are trending upwards. Insiders have a significant stake in the company, with a total investment of CN¥142m. The market is expected to follow EPS outcomes, making Waterdrop an attractive investment.

Waterdrop Inc. (NYSE:WDH), a leading provider of online insurance brokerage services in China, has demonstrated impressive financial performance over the past three years. The company has reported an annual EPS growth of 57%, an increase from 1.1% to 7.4% in EBIT margins over the last 12 months, and an upward trend in revenues. Insiders hold a significant stake in the company, with a total investment of CN¥142m.

Waterdrop's strategic expansions in customer acquisition and the development of inclusive insurance products have contributed to its growth. The company's AI innovations aim to improve sales efficiency, reduce costs, and drive future revenue growth [1]. Despite these positive indicators, Waterdrop's stock has experienced market volatility, with a 5.6% decline in share price during mid-day trading on Wednesday, July 30, 2025, dropping to $1.67 from a previous close of $1.77 [2].

Analysts have downgraded Waterdrop's rating from "buy" to "hold", reflecting a more cautious outlook on the company's performance. This shift is likely due to concerns about the company's ability to navigate stricter regulations and rising compliance costs, as well as demographic challenges in China [1]. Additionally, the company's market cap stands at $603.17 million, with a P/E ratio of 11.07 and a beta of -0.30, indicating a relatively low risk profile [2].

Institutional investors have shown interest in Waterdrop, with Jane Street Group acquiring a new stake worth about $78,000 and Baader Bank raising its holdings by 28.6% to over $2.4 million [2]. However, the market's expectation for EPS outcomes may influence Waterdrop's stock performance, making it an attractive investment for those willing to take on market volatility.

References:
[1] https://simplywall.st/stock/nyse/wdh
[2] https://www.marketbeat.com/instant-alerts/waterdrop-nysewdh-trading-down-56-should-you-sell-2025-07-30/