Zacks.com featured highlights Nova, Energizer, S&T Bancorp and Norwegian Cruise Line
For Immediate Release
Chicago, IL – August 29, 2024 – Stocks in this week’s article are Nova Ltd. NVMI, Energizer ENR, S&T Bancorp STBA and Norwegian Cruise Line NCLH.
4 Must-Buy Efficient Stocks to Increase Portfolio Returns
Irrespective of market conditions, companies with favorable efficiency levels are more likely to be investors’ choices. The reason is that a company with a favorable efficiency level is expected to offer impressive returns as it is believed to be positively correlated to its price performance.
The efficiency ratio is an indication of a company’s financial health. It analyzes how efficiently a company uses its assets and liabilities internally.
However, at times it becomes difficult to measure the efficiency level of a company. This is why one must consider the popular efficiency ratios listed below while selecting stocks.
To that end, Nova Ltd., Energizer, S&T Bancorp and Norwegian Cruise Line made it through the screen process:
Efficiency Ratios – To be Considered
Receivables Turnover: This is the ratio of 12-month sales to four-quarter average receivables. It shows a company’s potential to extend its credit and collect debt in terms of that credit. A high receivables turnover ratio or the “accounts receivable turnover ratio” or “debtor’s turnover ratio” is desirable as it shows that the company is capable of collecting its accounts receivables or that it has quality customers.
Asset Utilization: This ratio indicates a company’s capability to convert assets into output and is thus a widely known measure of efficiency level. It is calculated by dividing total sales over the past 12 months by the last four-quarter average of total assets. Like the above ratios, high asset utilization may indicate that a company is efficient.
Inventory Turnover: The ratio of the 12-month cost of goods sold (COGS) to a four-quarter average inventory is considered one of the most popular efficiency ratios. It indicates a company’s ability to maintain a suitable inventory position. While a high value indicates that the company has a relatively low level of inventory compared to COGS, a low value indicates that the company is facing declining sales, which has resulted in excess inventory.
Operating Margin: This efficiency measure is the ratio of operating income over the past 12 months to sales over the same period. It measures a company’s ability to control operating expenses. Hence, a high value of the ratio may indicate that the company manages its operating expenses more efficiently than its peers.
Here are the top four stocks that made it through the screen:
Nova
Nova is a provider of metrology solutions for advanced process control used in semiconductor manufacturing. NVMI has an average four-quarter positive earnings surprise of 12.4%.
Energizer
Energizer is one of the world’s leading manufacturers and distributors of batteries and lighting products. ENR has an average four-quarter positive earnings surprise of 8.5%.
S&T Bancorp
S&T Bancorp is a bank holding company that is engaged in general banking business. STBA has an average four-quarter positive earnings surprise of 7.1%.
Norwegian Cruise Line
Norwegian Cruise Line is a leading cruise line operator. NCLH has an average four-quarter positive earnings surprise of 5.7%.
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For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/2328131/4-must-buy-efficient-stocks-to-increase-portfolio-returns
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Energizer Holdings, Inc. (ENR) : Free Stock Analysis Report
Norwegian Cruise Line Holdings Ltd. (NCLH) : Free Stock Analysis Report
S&T Bancorp, Inc. (STBA) : Free Stock Analysis Report
Nova Ltd. (NVMI) : Free Stock Analysis Report