4 High-Profit Large-Cap Stocks With Minimal Debt

by: ZetaKap

Throughout the day, we can get caught up in our routines and crossing off tasks on our to-do list. When we are in this mode, we may get a lot done, but there can be a tendency to rely on habit rather than trying something new. Keeping an open mind to doing things a bit differently can create some discomfort, but also present opportunities that may prove to be lucrative or time saving in the end. Along these lines we focused on large-cap stocks for our list today. Due to their size, there is the perception that these companies have already peaked in terms of growth, but that is not always the case. Especially when the company is pulling in great profits and has maintained healthy debt ratios. These traits speak to companies that have built a solid groundwork from which to flourish. We think you will be intrigued by the large caps we have listed below.

The Long Term Debt/Equity Ratio is a variation of the traditional debt-to-equity ratio; this value computes the proportion of a company's long-term debt compared with its available capital. By using this ratio, investors can identify the amount of leverage utilized by a specific company and compare it to others to help analyze the company's risk exposure. Generally, companies that finance a greater portion of their capital via debt are considered riskier than those with lower leverage ratios.

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.

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

The Operating Profit Margin is a profitability ratio that measures the effectiveness of the company's operating efficiency. This metric allows investors to see how much profit is left after all variable costs are covered. If the company's margin is increasing over time this means that it's earning more per dollar of sales. Finding trends in the Operating Profit Margin helps investors identify companies that are improving profitability over time and managing the economic landscape better than competitors.

We first looked for large cap stocks. We then looked for companies that operate with little to no long term debt (Long Term D/E Ratio<.1). We then looked for businesses that operate with little to no debt (D/E Ratio<.1). We then looked for companies that have achieved strong bottom line profitability (Net Margin [TTM]>10%) (1-year operating margin>15%). We did not screen out any sectors.

Do you think these large-cap stocks have what it takes to grow? Use this list as a starting-off point for your own analysis.

1) Monster Beverage Corporation (NASDAQ:MNST)

Sector Consumer Goods
Industry Beverages - Soft Drinks
Market Cap $10.06B
Beta 0.43

MNST stock chart

Key Metrics

Long Term Debt/Equity Ratio 0.00
Debt/Equity Ratio 0.00
Net Margin 17.23%
Operating Profit Margin 27.51%
Short Interest 3.24%

Monster Beverage Corporation, through its subsidiaries, develops, markets, sells and distributes alternative beverage category beverages in the United States and internationally. The company distributes its products principally under the Monster Energy, Monster Rehab, Monster Energy Extra Strength Nitrous Technology, Java Monster, X-Presso Monster, Worx Energy, Peace Tea, Hansen's, Hansen's Natural Soda, Junior Juice, Blue Sky, Hubert's, and Vidration brands. The company was formerly known as Hansen Natural Corporation and changed its name to Monster Beverage Corporation in January 2012. Monster Beverage Corporation was founded in 1985 and is based in Corona, California.

2) QUALCOMM Incorporated (NASDAQ:QCOM)

Sector Technology
Industry Communication Equipment
Market Cap $106.70B
Beta 0.99

QCOM stock chart

Key Metrics

Long Term Debt/Equity Ratio 0.00
Debt/Equity Ratio 0.03
Net Margin 27.76%
Operating Profit Margin 30.46%
Short Interest 1.03%

QUALCOMM Incorporated designs, develops, manufactures and markets digital telecommunications products and services. It operates in four segments: Qualcomm CDMA Technologies, Qualcomm Technology Licensing, Qualcomm Wireless and Internet, and Qualcomm Strategic Initiatives. The company operates primarily in China, South Korea, Taiwan, Japan, and the United States. QUALCOMM Incorporated was founded in 1985 and its headquarters is in San Diego, California.

3) Precision Castparts Corp. (NYSE:PCP)

Sector Industrial Goods
Industry Metal Fabrication
Market Cap $23.77B
Beta 1.28

PCP stock chart

Key Metrics

Long Term Debt/Equity Ratio 0.03
Debt/Equity Ratio 0.03
Net Margin 17.01%
Operating Profit Margin 25.41%
Short Interest 0.99%

Precision Castparts Corp. manufactures and sells metal components and products worldwide. Its Investment Cast Products segment offers aerospace structural and airfoil castings for the turbine section of jet aircraft engines; investment castings for industrial gas turbine engines; artificial hips and knees for medical prostheses applications; landing gear struts and engine inlets for unmanned aerial vehicles; impellers for pumps and compressors; titanium components for armaments; and alloys for other investment casting companies. Precision Castparts Corp. was founded in 1949 and its headquarters is in Portland, Oregon.

4) ARM Holdings plc (NASDAQ:ARMH)

Sector Technology
Industry Semiconductor - Specialized
Market Cap $13.32B
Beta 0.98

ARMH stock chart

Key Metrics

Long Term Debt/Equity Ratio 0.00
Debt/Equity Ratio 0.00
Net Margin 26.87%
Operating Profit Margin 35.68%
Short Interest 1.48%

ARM Holdings plc designs reduced instruction set computing (RISC) microprocessors, physical intellectual property, and related technology and software. Its products and services include 16/32-bit RISC microprocessors cores, data engines, graphics intellectual property, and on-chip fabric intellectual property; embedded software; physical intellectual property; development tools; and consulting, support, and maintenance services. The company was founded in 1990 as Advanced RISC Machines Holdings Limited and changed its name to ARM Holdings plc in 1998. ARM Holdings is based in Cambridge, the United Kingdom.

Company profiles were sourced from Google Finance and Yahoo Finance. Financial data was sourced from Finviz on 10/08/2012.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Business relationship disclosure: This article was prepared for ZetaKap Media by one of our full-time analysts. We did not receive compensation for this article (other than from Seeking Alpha), and we have no business relationship with any company whose stock is mentioned in this article.