Do you prefer to invest in companies that have received a vote of confidence from industry analysts? For a closer look at companies that have achieved favorable analyst ratings, we ran a screen.
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. As well, it 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 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
We first looked for large cap consumer stocks that analysts rate as "Buy" (2 < mean recommendation < 3). We next screened for businesses with strong profitability (ROA > 10%)(Net Margin [TTM]>10%).
Do you think these large-cap stocks are worthy of their 'Buy' ratings? Use our screened list as a starting point for your own analysis and research.
1) Mattel Inc. (MAT)
| Sector: | Consumer Goods |
| Industry: | Toys & Games |
| Market Cap: | $10.62B |
| Beta: | 0.94 |
Mattel Inc. has a Return on Assets of 14.44% and Net Margin of 12.17% and Analysts' Rating of 2.00. The short interest was 3.25% as of 05/30/2012. Mattel, Inc., together with its subsidiaries, designs, manufactures, and markets various toy products. Its products comprise fashion dolls and accessories, vehicles and play sets, and games and puzzles. The company offers its products under the Mattel Girls and Boys brands, including Barbie, Polly Pocket, Little Mommy, Disney Classics, Monster High, Hot Wheels, Matchbox, Tyco R/C, CARS, Radica, Toy Story, WWE Wrestling, and Batman; Fisher-Price brands comprising Fisher-Price, Little People, BabyGear, View-Master, Dora the Explorer, Go Diego Go!, Thomas and Friends, Mickey Mouse, Sing-a-ma-jigs, See N Say, and Power Wheels; and American Girl Brands, such as My American Girl, Bitty Baby, McKenna, and the newest Girl of the Year.
2) Philip Morris International, Inc. (PM)
| Sector: | Consumer Goods |
| Industry: | Cigarettes |
| Market Cap: | $144.77B |
| Beta: | 0.86 |
Philip Morris International, Inc. has a Return on Assets of 25.36% and Net Margin of 11.72% and Analysts' Rating of 2.30. The short interest was 0.53% as of 05/30/2012. Philip Morris International Inc., through its subsidiaries, manufactures and sells cigarettes and other tobacco products. Its portfolio of international and local brands include Marlboro, Merit, Parliament, Virginia Slims, L&M, Chesterfield, Bond Street, Lark, Muratti, Next, Philip Morris, and Red & White. The company's local brands comprise Sampoerna A, Dji Sam Soe, and Sampoerna Kretek in Indonesia; Fortune, Champion, and Hope in the Philippines; Diana in Italy; Optima and Apollo-Soyuz in Russia; Morven Gold in Pakistan; Boston in Colombia; Belmont, Canadian Classics, and Number 7 in Canada; Best and Classic in Serbia; f6 in Germany; Delicados in Mexico; Assos in Greece; and Petra in the Czech Republic and Slovakia.
3) Monster Beverage Corporation (MNST)
| Sector: | Consumer Goods |
| Industry: | Beverages - Soft Drinks |
| Market Cap: | $12.98B |
| Beta: | 0.56 |
Monster Beverage Corporation has a Return on Assets of 23.61% and Net Margin of 17.06% and Analysts' Rating of 2.50. The short interest was 1.31% as of 05/30/2012. Monster Beverage Corporation, through its subsidiaries, develops, markets, sells, and distributes alternative beverage category beverages in the United States and internationally. The company's Direct Store Delivery segment offers carbonated energy drinks, non-carbonated dairy based coffee plus energy drinks, carbonated energy drinks containing nitrous oxide, non-carbonated dairy based espresso plus energy drinks, non-carbonated rehydration energy drinks, energy supplements, and ready-to-drink iced teas. This segment sells its products through a distributor network.
4) Lorillard, Inc. (LO)
| Sector: | Consumer Goods |
| Industry: | Cigarettes |
| Market Cap: | $16.19B |
| Beta: | 0.43 |
Lorillard, Inc. has a Return on Assets of 31.44% and Net Margin of 16.89% and Analysts' Rating of 2.50. The short interest was 3.50% as of 05/30/2012. Lorillard, Inc., through its subsidiaries, manufactures and sells cigarettes in the United States. It markets approximately 43 product offerings in various brand names, including Newport, Kent, True, Maverick, and Old Gold. The company sells its products primarily to wholesale distributors, who in turn service retail outlets, chain store organizations, and government agencies.
5) The Coca-Cola Company (KO)
| Sector: | Consumer Goods |
| Industry: | Beverages - Soft Drinks |
| Market Cap: | $169.48B |
| Beta: | 0.52 |
The Coca-Cola Company has a Return on Assets of 10.99% and Net Margin of 18.63% and Analysts' Rating of 1.90. The short interest was 0.86% as of 05/30/2012. The Coca-Cola Company, a beverage company, engages in the manufacture, marketing, and sale of nonalcoholic beverages worldwide. The company primarily offers sparkling beverages and still beverages. Its sparkling beverages include nonalcoholic ready-to-drink beverages with carbonation, such as carbonated energy drinks, and carbonated waters and flavored waters.
6) Mead Johnson Nutrition Company (MJN)
| Sector: | Consumer Goods |
| Industry: | Processed & Packaged Goods |
| Market Cap: | $16.65B |
| Beta: | - |
Mead Johnson Nutrition Company has a Return on Assets of 20.25% and Net Margin of 14.34% and Analysts' Rating of 2.40. The short interest was 2.11% as of 05/30/2012. Mead Johnson Nutrition Company manufactures, distributes, and sells infant formulas, children's nutritional products, and other nutritional products in Asia, Europe, Latin America, and North America. Its infant formula products include formulas for routine feeding; solutions formulas for mild intolerance and specialty formula products, including formulas for severe intolerance; formulas for premature and low birth weight infants; and medical nutrition products. The company also offers products for infants with milk protein allergy, gas/fussiness, lactose intolerance, anti-regurgitation, severe protein sensitivity, multiple food allergies, fat malabsorption, and premature infants, as well as soy formula.
7) Coach, Inc. (COH)
| Sector: | Consumer Goods |
| Industry: | Textile - Apparel Footwear & Accessories |
| Market Cap: | $19.71B |
| Beta: | 1.62 |
Coach, Inc. has a Return on Assets of 34.69% and Net Margin of 21.34% and Analysts' Rating of 2.00. The short interest was 1.73% as of 05/30/2012. Coach, Inc. designs and markets accessories and gifts for women and men in the United States and internationally. It primarily offers handbags, women's and men's bag, accessories, business cases, footwear, wearables, jewelry, sunwear, travel bags, watches, and fragrance products. The company's accessories, include money pieces, wristlets, cosmetic cases, wallets, card cases, time management and electronic accessories, key rings, charms, and women's and men's belts; business cases, such as computer bags, messenger-style bags, and totes; wearables comprise jackets, sweaters, gloves, hats, and scarves; jewelry consisting of bangle bracelets, necklaces, rings, and earrings; and luggage and related accessories, such as travel kits and valet trays.
8) Hershey Co. (HSY)
| Sector: | Consumer Goods |
| Industry: | Confectioners |
| Market Cap: | $15.12B |
| Beta: | 0.27 |
Hershey Co. has a Return on Assets of 15.11% and Net Margin of 10.68% and Analysts' Rating of 2.40. The short interest was 2.05% as of 05/30/2012. The Hershey Company, together with its subsidiaries, engages in manufacturing, marketing, selling, and distributing various chocolate and confectionery products, pantry items, and gum and mint refreshment products worldwide. It offers chocolate and sugar confectionery products, including milk chocolate bars, chocolates, candies, candy bars, wafer bars, peanut butter cups, peanut caramel bars, boxed chocolates, malted milk balls, peppermint pattie, and toffee bars. The company also provides high-cacao dark chocolate products, such as chocolate bars, tasting squares, and home baking products; and natural and organic chocolate products consisting of chocolate bars, drinking chocolate, and baking products. In addition, it offers snack products comprising snack bars and macadamia snack nuts; and a line of refreshment products, such as mints, chewing gum, and bubble gum, as well as pantry items consisting of baking products, toppings, sundae syrups, and hot cocoa mix.
9) Ford Motor Co. (F)
| Sector: | Consumer Goods |
| Industry: | Auto Manufacturers - Major |
| Market Cap: | $40.68B |
| Beta: | 2.36 |
Ford Motor Co. has a Return on Assets of 10.91% and Net Margin of 14.06% and Analysts' Rating of 2.10. The short interest was 3.97% as of 05/30/2012. Ford Motor Company engages in the development, manufacture, distribution, and service of vehicles and related parts worldwide. The company operates through two sectors, Automotive and Financial Services. The automotive sector offers vehicles primarily under the Ford and Lincoln brand names. This sector markets cars, trucks, and parts through retail dealers in North America, and through distributors and dealers outside North America.
*Company profiles were sourced from Finviz. Financial data was sourced from Finviz and Google Finance.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
