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The operating profit margin is a profitability metric that measures firm operating efficiency. This ratio illustrates how much profit is left after variable costs are covered and before fixed costs are deducted. Investors should look for any potential trends in the operating profit margin to see if profitability of the firm is improving, deteriorating, or stable. The higher the margin, the better.

The current ratio is a liquidity metric that measures a firm’s ability to cover its short-term obligations. The higher the ratio, the easier it is for a firm to cover its short-term obligations. If the current ratio is below 1, that means that the company would be unable to cover all its short-term obligations at once, and that the firm is probably not in sound financial health.

We ran a screen for mid cap companies that have sound 1-year fiscal operating profit margins (> 10%). From this narrowed pool, we then screened for firms ample liquidity (current ratio > 2).

The operating margin ranks the firms from highest to lowest:

1. Changyou.com Ltd. (NASDAQ:CYOU)

Sector

Technology

Industry

Electronic Gaming & Multimedia

Market Cap

$1,697M

Beta

1.17

The firm’s 1-year fiscal operating margin is 61.39%. CYOU’s current ratio is 3.72%. The short interest was N/A as of 08/20/2011.

2. Royal Gold, Inc. (NASDAQ:RGLD)

Sector

Basic Materials

Industry

Gold

Market Cap

$4,326M

Beta

0.30

The company and acquires managing precious metals royalties. The firm’s 1-year fiscal operating margin is 54.94%. RGLD’s current ratio is 5.45%. The short interest was 7.50% as of 08/20/2011.

3. Linear Technology. (NASDAQ:LLTC)

Sector

Technology

Industry

Semiconductors

Market Cap

$6,876M

Beta

0.98

The company designs and sells markets linear integrated circuits. The firm’s 1-year fiscal operating margin is 51.71%. LLTC’s current ratio is 7.24%. The short interest was N/A as of 08/20/2011.

4. InterMune, Inc. (NASDAQ:ITMN)

Sector

Healthcare

Industry

Biotechnology

Market Cap

$1,502M

Beta

2.52

The company develops therapies in pulmonology and hepatology. The firm’s 1-year fiscal operating margin is 49.63%. TMN’s current ratio is 8.26%. The short interest was N/A as of 08/20/2011.

5. Atwood Oceanics, Inc. (NYSE:ATW)

Sector

Energy

Industry

Oil & Gas Drilling

Market Cap

$2,631M

Beta

1.63

The company offers offshore drilling and related services worldwide. The firm’s 1-year fiscal operating margin is 49.55%. ATW’s current ratio is 2.69%. The short interest was 9.90% as of 08/20/2011.

6. ViroPharma, Inc. (VPHM)

Sector

Healthcare

Industry

Biotechnology

Market Cap

$1,429M

Beta

1.72

The company develops and sells products that address serious infectious diseases. The firm’s 1- year fiscal operating margin is 48.22%. VPHM’s current ratio is 7.44%. The short interest was 11.30% as of 08/20/2011.

7. Dolby Laboratories, Inc. (NYSE:DLB)

Sector

Consumer Cyclical

Industry

Media - Diversified

Market Cap

$3,372M

Beta

0.88

The company develops and sells technologies relative to the entertainment space. The firm’s 1-Year year fiscal operating margin is 46.53%. DLB’s current ratio is 8.01%. The short interest was 5.90% as of 08/20/2011.

8. NetEase.com, Inc. (NASDAQ:NTES)

Sector

Technology

Industry

Internet Content & Information

Market Cap

$5,802M

Beta

0.97

The company operates an interactive online in China. The firm’s 1- year fiscal operating margin is 46.20%. NTES’s current ratio is 6.23%. The short interest was N/A as of 08/20/2011.

9. Impax Laboratories, Inc. (NASDAQ:IPXL)

Sector

Healthcare

Industry

Drug Manufacturers - Specialty & Generic

Market Cap

$1,338M

Beta

0.52

The firm’s 1-year fiscal operating margin is 44.72%.IPXL’s current ratio is 3.88%. The short interest was 7.40% as of 08/20/2011.

10. Spectra Energy Partners, LP. (NYSE:SEP)

Sector

Energy

Industry

Oil & Gas Midstream

Market Cap

$2,811M

Beta

0.12

The company operates natural gas transportation and storage assets. The firm’s 1- year fiscal operating margin is 44.36%. SEP’s current ratio is 7.34%. The short interest was N/A as of 08/20/2011.

We hope this list helps investors as they do their own due diligence on stocks with strong profitability and cash on hand.

Source: 10 Impressively Profitable Stocks With Cash On Hand