4 High-Volume Gainers With Impressive Net Margin Growth

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 |  Includes: ART, AVGO, MDCO, NL
by: Kapitall

Net margin, or net income/revenue, is a great measure of how well a company is profiting from revenues. Companies with different cost structures have very different net margins, and improvements in cost structure directly improve profitability.

We ran a screen on today’s high-volume gainers that have seen great improvements in their net margins. (Note: Relative volume expresses today's trading volume as a multiple of the three month average.)

We screened for companies with trailing-twelve-month (NYSE:TTM) net margin at least 10% greater than the prior year’s TTM net margin and at least 20% greater than the five-year net margin average.

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.


(Access iframes here)



Do you think these stocks will continue gaining? Use this list as a starting-off point for your own analysis.

List sorted by today’s gain.

1. Medicines Co. (NASDAQ:MDCO):
Drug Manufacturers Industry. Market cap of $936.07M. The stock gained 2.76% on relative volume at 1.63. TTM net profit margin at 26.68% vs. 5-year average of 3.93%. The stock might be undervalued at current levels, with a PEG ratio at 0.78, and P/FCF ratio at 11.92. It's been a rough couple of days for the stock, losing 6.06% over the last week.



2. Avago Technologies Limited (NASDAQ:AVGO):
Semiconductor Industry. Market cap of $8.19B. The stock gained 2.57% on relative volume at 2.6. TTM net profit margin at 24.24% vs. 5-year average of -0.24%. The stock has gained 59.4% over the last year.



3. NL Industries Inc. (NYSE:NL): Synthetics Industry. Market cap of $923.08M. The stock gained 2.27% on relative volume at 1.69. TTM net profit margin at 66.22% vs. 5-year average of 15.55%. The stock is exhibiting strong upside momentum - currently trading 10.53% above its SMA20, 21.73% above its SMA50, and 57.79% above its SMA200. The stock has had a good month, gaining 11.39%.

4. Artio Global Investors Inc. (NYSE:ART): Asset Management Industry. Market cap of $745.35M. The stock gained 1.84% on relative volume at 1.53. TTM net profit margin at 29.08% vs. 5-year average of -4.94%. The stock might be undervalued at current levels, with a PEG ratio at 0.71, and P/FCF ratio at 10.2. ART is a short squeeze candidate, with a short float at 8.12% (equivalent to 10.39 days of average volume). It's been a rough couple of days for the stock, losing 6.43% over the last week.

*Net margin data sourced from Screener.co, all other data sourced from Finviz.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.