Small-cap stocks tend to offer investors greater growth opportunities than large-cap alternatives, although this comes with its fair share of added risk. Are you looking for small caps? Interested in financial stocks? Looking for ways to dig deeper into a company's profitability? Do you prefer stocks that analysts rate a "Strong Buy"? For ideas on how to go about your analysis, here is a list you might be interested in.
The Net Margin is a profitability metric that illustrates, by percentage, how much of every dollar earned gets turned into a bottom line profit. This is just one of many profitability metrics used by investors and analysts to better understand what the company is being left with at the end of the day. Generally, a firm that can expand its net profit margins over a period of time will see its stock price rise as well due to the trend of increasing profitability. Net Margin = Net Income/Total Revenue
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.
We first looked for small-cap financial stocks. Next, we then screened for businesses that have been able to retain strong profit margins on the bottom line (Net Margin [TTM]>10%)(1-year fiscal EPS growth rate>10%). Next, we then screened for businesses that analysts rate as "Strong Buy" (mean recommendation < 2).
Do you think these small-cap stocks deserve to grow higher? Use our list to help with your own analysis.
Colony Financial, Inc. (CLNY)
|Industry:||REIT - Diversified|
Colony Financial, Inc. has a Net Margin of 64.10%; an Earnings Per Share Growth Rate of 23.35%; and Analysts' Rating of 1.50. The short interest was 4.30% as of 05/17/2012. Colony Financial, Inc. operates as a real estate finance and investment company that focuses primarily on acquiring, originating, and managing commercial mortgage loans, and other commercial real estate-related debt investments. The company has elected to be taxed as a real estate investment trust for federal income tax purposes. It generally would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders.
Monmouth Real Estate Investment Corp. (NYSE:MNR)
|Industry:||REIT - Industrial|
Monmouth Real Estate Investment Corp. has a Net Margin of 38.56%; Earnings Per Share Growth Rate of 11.04%; and Analysts' Rating of 1.50. The short interest was 4.22% as of 05/17/2012. Monmouth Real Estate Investment Corporation is a real estate investment trust. It owns, manages, and leases properties to investment-grade tenants on long-term leases. The firm invests in the public equity and real estate markets of the United States. It primarily invests in industrial properties and holds a portfolio of REIT securities.
HFF, Inc. (NYSE:HF)
HFF, Inc. has a Net Margin of 15.53%; Earnings Per Share Growth Rate of 175.51%; and Analysts' Rating of 1.50. The short interest was 2.84% as of 05/17/2012. HFF, Inc. provides commercial real estate and capital markets services to users and providers of capital in the commercial real estate industry in the United States. The company offers debt placement services, including construction and construction/mini-permanent loans, adjustable and fixed rate mortgages, entity level debt, mezzanine debt, forward delivery loans, tax exempt financing, and sale/leaseback financing to the owners of various types of properties. It also provides investment sales services to commercial real estate owners; structured finance and private equity alternatives and solutions at various levels of the capital structure comprising mezzanine and equity; and distressed debt and real estate owned advisory services.
Hanmi Financial Corporation (NASDAQ:HAFC)
|Industry:||Regional - Pacific Banks|
Hanmi Financial Corporation has a Net Margin of 20.61%; Earnings Per Share Growth Rate of 118.46%; and Analysts' Rating of 1.50. The short interest was 3.30% as of 05/17/2012. Hanmi Financial Corporation operates as the holding company for Hanmi Bank that provides business banking products and services in the United States. Its deposit product line comprises business and personal checking accounts, savings accounts, negotiable order of withdrawal accounts, money market accounts, and certificates of deposit. The company's loan portfolio includes real estate loans, such as commercial property, construction, and residential property loans; commercial and industrial loans comprising commercial term loans, commercial lines of credit, small business administration loans, and international trade finance; and consumer loans consisting of automobile loans, secured and unsecured personal loans, home improvement loans, home equity lines of credit, overdraft protection loans, and unsecured lines of credit and credit cards.
Epoch Investment Partners, Inc. (NASDAQ:EPHC)
Epoch Investment Partners, Inc. has a Net Margin of 25.46%; Earnings Per Share Growth Rate of 78.91%; and Analysts' Rating of 1.50. The short interest was 3.82% as of 05/17/2012. Epoch Investment Partners, Inc. is a publicly owned investment manager. The firm primarily provides its services to pooled investment vehicles, typically mutual funds. It also caters to high net worth individuals, investment companies, corporations, public funds, foundations, state or municipal government entities, endowments, pension and profit sharing plans, and charitable organizations.
Kearny Financial Corp. (NASDAQ:KRNY)
|Industry:||Savings & Loans|
Kearny Financial Corp. has a Net Margin of 10.33%; Earnings Per Share Growth Rate of 16.63%; and Analysts' Rating of 1.00. The short interest was 2.23% as of 05/17/2012. Kearny Financial Corp. operates as a holding company for Kearny Federal Savings Bank that provides various financial services in New Jersey. The company offers various deposit products, including general deposits, interest-bearing and non-interest bearing checking accounts, money market deposit accounts, savings accounts, and certificates of deposits. It also provides various loans comprising one-to-four family mortgage loans; multi-family and nonresidential real estate mortgage loans; commercial business loans; home equity loans; home equity lines of credit; loans secured by savings accounts and certificates of deposit on deposit with the bank; construction loans to builders/developers and individual homeowners; and overdraft lines of credit, as well as offers vehicle loans and personal loans.
*Company profiles were sourced from Finviz. Financial data was sourced from Finviz.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.