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Zacks.com featured highlights H&E Equipment Services, Barrett Business Services, StoneX and Dycom
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For Immediate Release
Chicago, IL – April 17, 2024 – Stocks in this week’s article are H&E Equipment Services, Inc. (HEES - Free Report) , Barrett Business Services, Inc. (BBSI - Free Report) , StoneX Group Inc. (SNEX - Free Report) and Dycom Industries Inc. (DY - Free Report) .
Grab These 4 Solid Net Profit Margin Stocks for Strong Returns
Investors eye businesses that generate profits on a regular basis. In order to gauge the extent of profits, there is no better metric than net profit margin.
A higher net margin underlines a company’s efficiency in translating sales into actual profits. Moreover, this metric lends an insight into how well a company is run and the headwinds weighing on it. H&E Equipment Services, Inc., Barrett Business Services, Inc., StoneX Group Inc. and Dycom Industries Inc. boast solid net profit margins.
Net Profit Margin = Net profit/Sales * 100.
In simple terms, net profit is the amount a company retains after deducting all costs, interest, depreciation, taxes and other expenses. In fact, the net profit margin can turn out to be a potent point of reference to gauge the strength of a company’s operations and its cost-control measures.
Also, higher net profit is essential for rewarding stakeholders. Further, strength in the metric attracts investors and draws well-skilled employees, who eventually enhance business value.
Moreover, a higher net profit margin compared with its peers provides the company with a competitive edge.
Pros and Cons
Net profit margin helps investors gain clarity on a company’s business model in terms of pricing policy, cost structure and manufacturing efficiency. Hence, a strong net profit margin is preferred by all classes of investors.
However, net profit margin as an investment criterion has its share of pitfalls. The metric varies widely from industry to industry. While net income is a key metric for investment measurement in traditional industries, it is not that important for technology companies.
In addition, the difference in accounting treatment of various items — especially non-cash expenses like depreciation and stock-based compensation — makes comparison a daunting task.
Furthermore, for companies preferring to grow with debt instead of equity funding, higher interest expenses usually weigh on net profit. In such cases, the measure is rendered ineffective while analyzing a company’s performance.
The Winning Strategy
A healthy net profit margin and solid EPS growth are the two most sought-after elements in a business model.
Apart from these, we have added a few criteria to ensure maximum returns from this strategy.
Here we discuss our four picks from the 21 stocks that qualified the screen:
H&E Equipment is one of the largest integrated equipment services companies in the United States, with full-service facilities throughout the Intermountain, Southwest, Gulf Coast & Southeast regions of the United States. The stock sports a Zacks Rank of 1 at present and has a VGM Score of A.
The Zacks Consensus Estimate for H&E Equipment’s 2024 earnings has been revised upward by 15 cents to $5.02 per share in the past 60 days. H&E Equipment surpassed the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 17.2%.
Barrett Business Services provides light industrial, clerical and technical employees to a wide range of businesses through staff leasing, contract staffing, site management and temporary staffing arrangements. The stock has a Zacks Rank of 2 at present and a VGM Score of A.
The Zacks Consensus Estimate for Barrett Business Services’ 2024 earnings has been revised upward by 11 cents to $7.78 per share in the past 60 days. BBSI surpassed the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 77.7%.
StoneX Group provides financial services. The company, through its subsidiaries, offers execution, post-trade settlement, clearing and custody services. The stock carries a Zacks Rank #2 at present and has a VGM Score of A.
The Zacks Consensus Estimate of $7.61 per share for StoneX Group’s fiscal 2024 earnings has moved 20 cents north in the past seven days. SNEX surpassed the Zacks Consensus Estimate thrice in the trailing four quarters while missing the same on one occasion, the average surprise being 15.9%.
Dycom Industries is a specialty contracting firm operating in the telecom industry. The company provides diverse services such as engineering, construction, maintenance and installation services for the cable and telephone companies. The stock carries a Zacks Rank of 2 at present and has a VGM Score of A.
The Zacks Consensus Estimate for Dycom Industries’ fiscal 2025 earnings has been revised upward by 19 cents to $7.13 per share in the past 30 days. DY surpassed the Zacks Consensus Estimate thrice in the trailing four quarters while missing the same on one occasion, the average surprise being 53.9%.
Get the rest of the stocks on the list and start putting this and other ideas to the test. It can all be done with the Research Wizard stock picking and back-testing software.
The Research Wizard is a great place to begin. It's easy to use. Everything is in plain language. And it's very intuitive. Start your Research Wizard trial today. And the next time you read an economic report, open up the Research Wizard, plug your finds in, and see what gems come out.
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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Zacks.com featured highlights H&E Equipment Services, Barrett Business Services, StoneX and Dycom
For Immediate Release
Chicago, IL – April 17, 2024 – Stocks in this week’s article are H&E Equipment Services, Inc. (HEES - Free Report) , Barrett Business Services, Inc. (BBSI - Free Report) , StoneX Group Inc. (SNEX - Free Report) and Dycom Industries Inc. (DY - Free Report) .
Grab These 4 Solid Net Profit Margin Stocks for Strong Returns
Investors eye businesses that generate profits on a regular basis. In order to gauge the extent of profits, there is no better metric than net profit margin.
A higher net margin underlines a company’s efficiency in translating sales into actual profits. Moreover, this metric lends an insight into how well a company is run and the headwinds weighing on it. H&E Equipment Services, Inc., Barrett Business Services, Inc., StoneX Group Inc. and Dycom Industries Inc. boast solid net profit margins.
Net Profit Margin = Net profit/Sales * 100.
In simple terms, net profit is the amount a company retains after deducting all costs, interest, depreciation, taxes and other expenses. In fact, the net profit margin can turn out to be a potent point of reference to gauge the strength of a company’s operations and its cost-control measures.
Also, higher net profit is essential for rewarding stakeholders. Further, strength in the metric attracts investors and draws well-skilled employees, who eventually enhance business value.
Moreover, a higher net profit margin compared with its peers provides the company with a competitive edge.
Pros and Cons
Net profit margin helps investors gain clarity on a company’s business model in terms of pricing policy, cost structure and manufacturing efficiency. Hence, a strong net profit margin is preferred by all classes of investors.
However, net profit margin as an investment criterion has its share of pitfalls. The metric varies widely from industry to industry. While net income is a key metric for investment measurement in traditional industries, it is not that important for technology companies.
In addition, the difference in accounting treatment of various items — especially non-cash expenses like depreciation and stock-based compensation — makes comparison a daunting task.
Furthermore, for companies preferring to grow with debt instead of equity funding, higher interest expenses usually weigh on net profit. In such cases, the measure is rendered ineffective while analyzing a company’s performance.
The Winning Strategy
A healthy net profit margin and solid EPS growth are the two most sought-after elements in a business model.
Apart from these, we have added a few criteria to ensure maximum returns from this strategy.
Here we discuss our four picks from the 21 stocks that qualified the screen:
H&E Equipment is one of the largest integrated equipment services companies in the United States, with full-service facilities throughout the Intermountain, Southwest, Gulf Coast & Southeast regions of the United States. The stock sports a Zacks Rank of 1 at present and has a VGM Score of A.
The Zacks Consensus Estimate for H&E Equipment’s 2024 earnings has been revised upward by 15 cents to $5.02 per share in the past 60 days. H&E Equipment surpassed the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 17.2%.
Barrett Business Services provides light industrial, clerical and technical employees to a wide range of businesses through staff leasing, contract staffing, site management and temporary staffing arrangements. The stock has a Zacks Rank of 2 at present and a VGM Score of A.
The Zacks Consensus Estimate for Barrett Business Services’ 2024 earnings has been revised upward by 11 cents to $7.78 per share in the past 60 days. BBSI surpassed the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 77.7%.
StoneX Group provides financial services. The company, through its subsidiaries, offers execution, post-trade settlement, clearing and custody services. The stock carries a Zacks Rank #2 at present and has a VGM Score of A.
The Zacks Consensus Estimate of $7.61 per share for StoneX Group’s fiscal 2024 earnings has moved 20 cents north in the past seven days. SNEX surpassed the Zacks Consensus Estimate thrice in the trailing four quarters while missing the same on one occasion, the average surprise being 15.9%.
Dycom Industries is a specialty contracting firm operating in the telecom industry. The company provides diverse services such as engineering, construction, maintenance and installation services for the cable and telephone companies. The stock carries a Zacks Rank of 2 at present and has a VGM Score of A.
The Zacks Consensus Estimate for Dycom Industries’ fiscal 2025 earnings has been revised upward by 19 cents to $7.13 per share in the past 30 days. DY surpassed the Zacks Consensus Estimate thrice in the trailing four quarters while missing the same on one occasion, the average surprise being 53.9%.
Get the rest of the stocks on the list and start putting this and other ideas to the test. It can all be done with the Research Wizard stock picking and back-testing software.
The Research Wizard is a great place to begin. It's easy to use. Everything is in plain language. And it's very intuitive. Start your Research Wizard trial today. And the next time you read an economic report, open up the Research Wizard, plug your finds in, and see what gems come out.
Click here to sign up for a free trial to the Research Wizard today.
For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/2255818/grab-these-4-solid-net-profit-margin-stocks-for-strong-returns
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Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Contact: Jim Giaquinto
Company: Zacks.com
Phone: 312-265-9268
Email: pr@zacks.com
Visit: https://www.zacks.com/
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.