Chicago, IL – May 6, 2022 – Stocks in this week’s article are Xencor XNCR, Encore Wire WIRE and Silvergate Capital SI.
3 Best Profitable Stocks to Buy Using Net Income Ratios
Profitability analysis is the best tool to measure the ability of the company to offer sturdy returns to investors even after meeting all operating and non-operating costs. Profitability analysis identifies a profitable company over a loss-making one. Thus, investors always seek profitable companies.
Here, we have used the concept of accounting ratios to evaluate a company's profitability. There is a variety of profitability ratios, from which we have chosen the most successful and frequently used profitability metric to determine the bottom-line performance of a company.
Net Income Ratio
Net income ratio gives us the exact profitability level of a company. It reflects the percentage of net income to total sales revenues. Using net income ratio, one can determine a company's effectiveness in meeting operating and non-operating expenses from revenues. A higher net income ratio usually implies a company's ability to generate ample revenues and successfully manage all business functions.
Here are three of the 12 stocks that qualified the screening:
Xencor is a clinical-stage biopharmaceutical company. Xencor develops antibodies to treat autoimmune diseases, asthma and allergic diseases, and cancer. The 12-month net profit margin of XNCR is 30.04%.
Encore Wire is a low-cost manufacturer of copper electrical building wire and cable. Encore Wire is a significant supplier of both residential wire for interior electrical wiring in homes, apartments and manufactured housing as well as building wire for electrical distribution in commercial and industrial buildings. The 12-month net profit margin of WIRE is 23.05%.
Silvergate Capital is a bank holding company for Silvergate Bank. Silvergate Capital is based in La Jolla, United States. The 12-month net profit margin of SI is 45.57%.
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