In the business world, there is one word that resounds louder than all others: profit. When a company is not profitable, its future appears bleak. For many investors, sticking with profitable companies is a steadfast rule. Beyond that, analyst ratings are also an important snapshot of what is in store for a stock. Keeping these ideas in mind, today we scanned specifically for companies reporting consistent and strong profits, and from there we further reduced our candidates to only include those that have an average analyst rating of 'Strong Buy'. We encourage you to take a look at this diverse list of intriguing mid cap companies.
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 mid cap stocks. We next screened for businesses with strong profitability (Net Margin [TTM] >10%)(1-year fiscal EPS growth rate>10%). We then looked for companies that analysts rate as "Strong Buy" (mean recommendation < 2). We did not screen out any sectors.
Do you think these mid-cap stocks hold solid value? Use our list along with your own analysis.
1) The Howard Hughes Corporation (HHC)
|Industry||REIT - Diversified|
|Earnings Per Share Growth Rate||163.56%|
The Howard Hughes Corporation is a real estate investment and development company, engaging in managing, developing, and leasing commercial, residential, and mixed-use real estate. The firm invests in retail, commercial, and industrial buildings in United States. Its facilities feature residential, entertainment, mixed use, recreation, culture, and resort components. It also develops single-family homes, town homes, and condominiums, as well as involves in office buildings and land developments. The Howard Hughes Corporation was formerly known as Summa Corporation and changed its name in 1994. The Howard Hughes Corporation was founded in 1913 and is based in Dallas, Texas. The Howard Hughes Corporation operates independently of The Rouse Company LLC as of November 5, 2010.
2) IdaCorp, Inc. (IDA)
|Earnings Per Share Growth Rate||13.86%|
IDACORP, Inc., through its subsidiary, Idaho Power Company, engages in the generation, transmission, distribution, sale, and purchase of electric energy in the United States. It owns and operates 17 hydroelectric generating plants located in southern Idaho and eastern Oregon, as well as 2 natural gas-fired plants situated in southern Idaho; and owns interests in 3 coal-fired steam electric generating plants located in Wyoming, Nevada, and Oregon. As of December 31, 2011, the company provided electric service to approximately 496,000 general business customers involved in food processing, electronics and general manufacturing, agriculture, forest products, beet sugar refining, and winter recreation. It had a network of approximately 4,828 pole miles of high-voltage transmission lines, 23 step-up transmission substations located at power plants, 24 transmission substations, 10 switching stations, 228 energized distribution substations, and approximately 26,714 pole miles of distribution lines. The company, through its other subsidiaries, invests in housing and other real estate investments in the United States, Puerto Rico, and the United States Virgin Islands. IDACORP, Inc. was founded in 1915 and is headquartered in Boise, Idaho.
3) Timken Co. (TKR)
|Industry||Machine Tools & Accessories|
|Earnings Per Share Growth Rate||68.10%|
The Timken Company develops, manufactures, markets, and sells anti-friction bearings and assemblies, alloy steels, and mechanical power transmission systems. It operates through four segments: Mobile Industries, Process Industries, Aerospace and Defense, and Steel. The Mobile Industries segment provides bearings, mechanical power transmission components, drive- and roller-chains, augers, and related products and services to original equipment manufacturers (OEMs) and suppliers of passenger cars, light trucks, medium and heavy-duty trucks, rail cars, locomotives, and agricultural, construction, and mining equipment, as well as to automotive and heavy truck aftermarket distributors. The Process Industries segment offers bearings, mechanical power transmission components, industrial chains, and related products and services to OEMs and suppliers of power transmission, energy, and heavy industries machinery and equipment. It also serves the aftermarket through its network of industrial distributors. The Aerospace and Defense segment provides bearings, helicopter transmission systems, rotor head assemblies, turbine engine components, gears, and other precision flight-critical components for commercial and military aviation applications; and offers aftermarket services, including repair and overhaul of engines, transmissions, and fuel controls, as well as aerospace bearing repair and component reconditioning. It also manufactures precision bearings, higher-level assemblies, and sensors for manufacturers of health and positioning control equipment. The Steel segment produces approximately 450 grades of carbon and alloy steel products, including ingots, bars, and tubes in various chemistries, lengths, and finishes for the automotive, industrial, and energy sectors. The company sells its products through its sales organizations and authorized distributors worldwide. The Timken Company was founded in 1899 and is headquartered in Canton, Ohio.
4) Nu Skin Enterprises Inc. (NUS)
|Earnings Per Share Growth Rate||12.70%|
Nu Skin Enterprises, Inc. develops and distributes anti-aging personal care products and nutritional supplements worldwide. The company sells its personal care products under the Nu Skin brand; and nutritional supplements under the Pharmanex brand. Its personal care product line includes core systems, such as ageLOC Transformation skin care system, Nu Skin 180 anti-aging skin therapy system, Nu Skin tri-phasic white, nutricentials, and Nu Skin Clear Action acne medication system; targeted treatments, including galvanic spa system, spa gels, spa body shaping gel, dermatic effects body contouring lotion, line corrector, skin conditioning gel, ultra recovery fluid, moisturizer, and skin refinisher; and total care line of products, such as body bar, liquid body lufra, body moisturizer, men's and dental care products, and hair mask. The company's personal care products also comprise Nu Colour line of cosmetic products, including tinted moisturizer, finishing powder, lip gloss, and mascara; and Epoch product line, such as body butter, foot treatment product, skin cream, marine mud, leg gel, shave gel, shampoo, and baby hair and body wash products. The company's nutritional supplements product line comprises micronutrient supplements, anti-aging products, and solutions supplements, as well as weight management products, including supplements and meal replacement shakes. It also sells Vitameal, a nutritious meal product to feed malnourished children or for personal food storage; and household products and digital content storage. The company sells its products primarily through a network of independent distributors in north Asia, the Americas, Greater China, Europe, and the south Asia/Pacific; and through its retail stores in China. As of December 31, 2011, it operated 40 stores in China. The company was founded in 1984 and is headquartered in Provo, Utah.
*Company profiles were sourced from Google Finance and Yahoo Finance. Financial data was sourced from Finviz on 08/23/2012.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.