9 European Stocks With Impressive Profitability

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 |  Includes: ACE, ALV, CBI, CLB, CMRE, ESV, IHG, SNN, TS
by: Kapitall

Although many expect the European Union to go into a light recession this year, that doesn't exclude all European companies from the possibility of outperformance.

With that in mind, we ran a screen on US-traded stocks of companies based in Europe for those with high profitability, beating their industry peers on gross, operating, and pretax margins.

Companies with higher profit margins than their peers are taking a greater percentage of revenues as profits and may also have greater control over their cost structure.

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.‬

We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 index over the last month. To access a complete analysis of this list's recent performance, click here.

Do you think these companies can maintain their high profitability? Use this list as a starting point for your own analysis.

List sorted by difference between gross margin and industry.

1. Intercontinental Hotels Group plc (NYSE:IHG): Owns, manages, franchises, and leases hotels and resorts. United Kingdom. Market cap of $6.06B. TTM gross margin at 55.88% vs. industry gross margin at 36.88%. TTM operating margin at 29.34% vs. industry operating margin at 19.35%. TTM pretax margin at 27.28% vs. industry pretax margin at 17.71%. The stock has had a couple of great days, gaining 8.37% over the last week.

2. Ensco plc (NYSE:ESV): Provides offshore contract drilling services to the oil and gas industry. United Kingdom. Market cap of $11.94B. TTM gross margin at 49.51% vs. industry gross margin at 34.04%. TTM operating margin at 29.63% vs. industry operating margin at 18.30%. TTM pretax margin at 26.75% vs. industry pretax margin at 16.34%. The stock has had a couple of great days, gaining 8.85% over the last week.

3. Costamare Inc. (NYSE:CMRE): Owns and charters containerships to liner companies. Greece. Market cap of $925.0M. TTM gross margin at 66.06% vs. industry gross margin at 48.41%. TTM operating margin at 40.15% vs. industry operating margin at 27.09%. TTM pretax margin at 20.04% vs. industry pretax margin at 16.03%. The stock is a short squeeze candidate, with a short float at 6.63% (equivalent to 13.24 days of average volume). The stock has had a couple of great days, gaining 7.2% over the last week.

4. Autoliv, Inc. (NYSE:ALV): Develops, manufactures, and supplies automotive safety systems to automotive industry. Sweden. Market cap of $5.70B. TTM gross margin at 24.33% vs. industry gross margin at 19.78%. TTM operating margin at 11.30% vs. industry operating margin at 7.63%. TTM pretax margin at 10.48% vs. industry pretax margin at 7.19%. This is a risky stock that is significantly more volatile than the overall market (beta = 2.01). The stock has had a couple of great days, gaining 9.62% over the last week.

5. Smith & Nephew plc (NYSE:SNN): Develops, manufactures, markets, and sells medical devices in the orthopaedics, endoscopy, and advanced wound management sectors worldwide. United Kingdom. Market cap of $8.51B. TTM gross margin at 80.38% vs. industry gross margin at 65.79%. TTM operating margin at 21.89% vs. industry operating margin at 14.60%. TTM pretax margin at 21.18% vs. industry pretax margin at 11.12%. The stock has lost 13.88% over the last year.

6. Tenaris SA (NYSE:TS): Engages in the manufacture and sale of steel pipe products. Luxembourg. Market cap of $23.78B. TTM gross margin at 41.09% vs. industry gross margin at 34.15%. TTM operating margin at 18.46% vs. industry operating margin at 18.20%. TTM pretax margin at 19.81% vs. industry pretax margin at 16.19%. The stock has had a good month, gaining 10.87%.

7. ACE Limited (NYSE:ACE): Provides a range of insurance and reinsurance products to insurers worldwide. Switzerland. Market cap of $24.21B. TTM gross margin at 15.95% vs. industry gross margin at 14.18%. TTM operating margin at 15.95% vs. industry operating margin at 11.31%. TTM pretax margin at 14.05% vs. industry pretax margin at 10.02%. The stock has gained 21.43% over the last year.

8. Chicago Bridge & Iron Company N.V. (NYSE:CBI): Provides engineering, procurement, and construction (EPC) solutions, as well as process technologies for the energy infrastructure projects. Netherlands. Market cap of $4.20B. TTM gross margin at 14.08% vs. industry gross margin at 12.72%. TTM operating margin at 7.73% vs. industry operating margin at 5.50%. TTM pretax margin at 7.94% vs. industry pretax margin at 4.48%. This is a risky stock that is significantly more volatile than the overall market (beta = 2.3). The stock has had a couple of great days, gaining 5.49% over the last week.

9. Core Laboratories NV (NYSE:CLB): Provides reservoir description, production enhancement, and reservoir management products and services to the oil and gas industry worldwide. Netherlands. Market cap of $5.21B. TTM gross margin at 34.73% vs. industry gross margin at 34.04%. TTM operating margin at 27.55% vs. industry operating margin at 18.30%. TTM pretax margin at 25.80% vs. industry pretax margin at 16.34%. The stock is a short squeeze candidate, with a short float at 10.18% (equivalent to 12 days of average volume). The stock has gained 32.15% over the last year.

*Profitability data sourced from Fidelity, 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.