Chicago, IL – March 11, 2025 – Stocks in this week’s article are Sterling Infrastructure, Inc. STRL, Kingstone Companies, Inc. KINS, Meritage Hospitality Group Inc. MHGU and CBIZ, Inc. CBZ.
Investors seek companies that consistently generate profits. One of the best metrics to measure profitability is the net profit margin. This metric highlights a company's ability to convert sales into actual profits, providing insights into operational efficiency and management quality. Sterling Infrastructure, Inc., Kingstone Companies, Inc., Meritage Hospitality Group Inc. and CBIZ, Inc. boast solid net profit margins.
Net profit represents the amount retained after all expenses, including costs, interest, depreciation and taxes. A strong net profit margin indicates effective cost control and operational strength, which are crucial for rewarding stakeholders and attracting investors and talented employees. Moreover, a higher net profit margin compared to peers provides a company with a competitive edge.
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, this metric varies across industries, making direct comparisons challenging. While it is vital for traditional industries, it might be less relevant for technology companies.
Differences in accounting practices, especially with regard to non-cash expenses like depreciation and stock-based compensation, further complicate comparisons. Additionally, companies that rely heavily on debt may show lower net profits due to high interest expenses, limiting the metric's effectiveness in evaluating performance.
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 13 stocks that qualified the screen:
Sterling Infrastructure operates through subsidiaries within segments specializing in E-Infrastructure, Building and Transportation Solutions, principally in the United States. The stock sports a Zacks Rank of 1 at present and a VGM Score of A. You can see the complete list of today's Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Sterling Infrastructure's 2025 earnings has been revised upward by 14% to $7.35 per share in the past 30 days. STRL surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 16.2%.
Kingstone Companies is engaged in offering property and casualty insurance to individuals in the United States. The stock sports a Zacks Rank of 1 at present and a VGM Score of A.
The Zacks Consensus Estimate for Kingstone Companies' 2025 earnings has been revised upward to $1.80 from $1.55 per share 30 days ago. KINS matched the Zacks Consensus Estimate in the preceding two quarters.
Meritage Hospitality specializes in the development and operation of restaurants and leisure properties. It owns and operates casual dining restaurants in Michigan, through brands consisting of Twisted Rooster locations, Crooked Goose location and Freighters Eatery & Taproom location. The stock currently sports a Zacks Rank of 1 and has a VGM Score of A.
The Zacks Consensus Estimate for Meritage Hospitality's 2025 bottom line has been revised upward to earnings of $1.36 from $1.12 per share projected in the past 60 days. MHGU surpassed the Zacks Consensus Estimate once in the trailing four quarters while missing the same on three occasions, the average surprise being -53.01%.
CBIZ specializes in offering insurance, financial and advisory services in the United States and Canada. The stock sports a Zacks Rank of 1 at present and has a VGM Score of B.
The Zacks Consensus Estimate for CBIZ's 2025 earnings has been revised upward by 23% to $3.63 per share in the past seven days. CBZ surpassed the Zacks Consensus Estimate twice in the trailing four quarters while missing the same on two occasions, the average surprise being 0.3%.
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/2427803/bet-on-these-4-stocks-with-solid-net-profit-margins-to-boost-returns
Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.
About Screen of the Week
Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine. But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year. See these high-potential stocks free >>.
Follow us on Twitter: https://www.twitter.com/zacksresearch
Join us on Facebook: https://www.facebook.com/ZacksInvestmentResearch
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/performancefor information about the performance numbers displayed in this press release.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
CBIZ, Inc. (CBZ) : Free Stock Analysis Report
Sterling Infrastructure, Inc. (STRL) : Free Stock Analysis Report
Kingstone Companies, Inc (KINS) : Free Stock Analysis Report
Meritage Hospitality Group Inc. (MHGU) : Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
免责声明：投资有风险，本文并非投资建议，以上内容不应被视为任何金融产品的购买或出售要约、建议或邀请，作者或其他用户的任何相关讨论、评论或帖子也不应被视为此类内容。本文仅供一般参考，不考虑您的个人投资目标、财务状况或需求。TTM对信息的准确性和完整性不承担任何责任或保证，投资者应自行研究并在投资前寻求专业建议。