Are you looking for mid-sized companies that still have room to grow? Interested in technology stocks? Interested in finding stocks that pay reliable dividends? Looking for ways to dig deeper into a company's profitability? In search of companies that can manage their debt well? For ideas on how to start your search, we ran a screen you may find helpful.
EPS growth (earnings per share growth) illustrates the growth of earnings per share over time. EPS growth rates help investors identify stocks that are increasing or decreasing in profitability. This profitability metric is generally a key driver in the price of the stock as it directly correlates to the profitability of the company as a whole.
Return on Assets [ROA] illustrates how much a company is generating in earnings from its assets alone. This metric gives investors a picture of how profitable the company is relative to the assets in current possession. It also lets investors see how efficient and effective management is at generating earnings from the company's assets. While most management teams can probably make money by throwing money at an issue, very few can make very large profits with little investment.
The Debt/Equity Ratio illustrates how aggressively a company is financing its growth via debt. The more debt financing that is used in a capital structure, the more volatile earnings can become due to the additional interest expense. Should a company's potentially enhanced earnings fail to exceed the cost associated with debt financing over time, this can lead the company toward substantial trouble.
We first looked for mid cap technology dividend stocks. From here, we then looked for companies that have shown strong bottom line growth over the last year (1-year fiscal EPS growth rate>10%)(ROA [TTM]>10%). We next screened for businesses that have maintained a sound capital structure (D/E Ratio<.3).
Do you think these mid-cap stocks have more value to price in? Use our list to help with your own analysis.
1) Jack Henry & Associates Inc. (JKHY)
|Industry:||Business Software & Services|
Jack Henry & Associates Inc. has a Dividend yield of 1.34% and Earnings Per Share Growth of 14.87% and Return on Assets of 10.11% and Debt/Equity Ratio of 0.16. The short interest was 3.20% as of 04/28/2012. Jack Henry & Associates, Inc. (JKHY) provides integrated computer systems and services for in-house and outsourced data processing to commercial banks, credit unions, and other financial institutions primarily in the United States. It engages in processing transactions, automating business processes, and managing information services. The company's Jack Henry Banking brand provides integrated data processing systems to de novo or start-up institutions and mid-tier banks, as well as markets three core banking software systems, such as SilverLake, a robust IBM i-based system designed for commercial-focused banks; CIF 20/20, a parameter-driven and easy-to-use system; and Core Director, a Windows-based and client/server system that offers intuitive point-and-click operation.
2) FactSet Research Systems Inc. (FDS)
|Industry:||Information & Delivery Services|
FactSet Research Systems Inc. has a Dividend yield of 1.03% and Earnings Per Share Growth of 15.43% and Return on Assets of 26.21% and Debt/Equity Ratio of 0.00. The short interest was 9.65% as of 04/28/2012. FactSet Research Systems Inc. provides financial and economic information to investment community worldwide. The company offers fundamental financial data on various companies, analytical applications, and client services to the portfolio managers, research and performance analysts, risk managers, marketing professionals, sell-side equity research professionals, investment bankers, and fixed income professionals. FactSet's applications provide users access to company analysis, multi-company comparisons, industry analysis, company screening, portfolio analysis, predictive risk measurements, alphatesting, portfolio optimization and simulation, news and quotes, and tools to value and analyze fixed income securities and portfolios.
3) KLA-Tencor Corporation (KLAC)
|Industry:||Semiconductor Equipment & Materials|
KLA-Tencor Corporation has a Dividend yield of 2.68% and Earnings Per Share Growth of 280.12% and Return on Assets of 17.08% and Debt/Equity Ratio of 0.25. The short interest was 4.40% as of 04/28/2012. KLA-Tencor Corporation designs, manufactures, and markets process control and yield management solutions for the semiconductor and related nanoelectronics industries. It offers equipment comprising wafer and integrated circuit [IC] defect monitoring, review, and classification; reticle defect inspection and metrology; packaging and interconnect inspection; critical dimension metrology; pattern overlay metrology; film thickness, surface topography, and composition measurements; measurement of in-chamber process conditions, wafer shape, and stress metrology; computational lithography tools; and yield and fab-wide data management and analysis systems. The company also provides products that serve the high brightness light emitting diode, data storage, and photovoltaic industries, as well as general materials research.
*Company profiles were sourced from Finviz. Financial data was sourced from Google Finance and Yahoo Finance.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.