Friday, April 20, 2012

3 Large Cap Stocks With Strong Return On Assets Ratios And Trading Near Their 52-Week Highs


Are you looking for large-cap companies that still have room to grow? Do you prefer companies with strong profits? Are you a momentum investor? If so, here's a list you might be interested in.

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.

We first looked for Large Cap stocks with strong profitability (ROA > 10%) and that are currently trading at no less than 20% below their 52-week highs. Why you wonder? The number shows these firms are doing something right consistently. The real question is "as an investor do you think the firms listed here have room to go even higher?". We did not screen out any sectors.

Do you think these large-cap stocks will go up in valuation? Use our list along with your own analysis.


1) Bed Bath & Beyond Inc. (BBBY)
Sector: Services
Industry: Home Furnishing Stores
Market Cap: $16.45B
Beta: 1.09
Bed Bath & Beyond Inc. has a Return on Assets of 17.40% and trading below it's 52 Week High by -6.30%. The short interest was 2.86% as of 04/19/2012. Bed Bath & Beyond Inc., together with its subsidiaries, operates a chain of retail stores. It sells a range of domestic merchandise, such as bed linens and related items, bath items, and kitchen textiles; and home furnishings, including kitchen and tabletop items, fine tabletop, basic housewares, general home furnishings, consumables, and certain juvenile products. The company also offers giftware, household products, and health and beauty care items; and infant and toddler merchandise.

2) Applied Materials Inc. (AMAT)
Sector: Technology
Industry: Semiconductor Equipment & Materials
Market Cap: $15.32B
Beta: 1.13
Applied Materials Inc. has a Return on Assets of 12.37% and trading below it's 52 Week High by -23.69%. The short interest was 1.10% as of 04/19/2012. Applied Materials, Inc. provides manufacturing equipment, services, and software to the semiconductor, flat panel display, solar photovoltaic (PV), and related industries worldwide. The company's Silicon Systems Group segment offers a range of manufacturing equipment used to fabricate semiconductor chips or integrated circuits. This segment provides systems that perform primary processes used in chip fabrication, including atomic layer deposition, chemical vapor deposition, physical vapor deposition, electrochemical deposition, rapid thermal processing, chemical mechanical planarization, wet cleaning, and wafer metrology and inspection, as well as systems that etch or inspect circuit patterns on masks used in the photolithography process.

3) Becton, Dickinson and Company (BDX)
Sector: Healthcare
Industry: Medical Instruments & Supplies
Market Cap: $16.01B
Beta: 0.59
Becton, Dickinson and Company has a Return on Assets of 11.30% and trading below it's 52 Week High by -13.62%. The short interest was 3.55% as of 04/19/2012. Becton, Dickinson and Company, a medical technology company, develops, manufactures, and sells medical devices, instrument systems, and reagents worldwide. The company's BD Medical segment produces medical devices that are used in various healthcare settings. This segment's products include needles, syringes, and intravenous catheters for medication delivery; prefilled IV flush syringes; syringes, pen needles, and other drugs to treat diabetes; prefillable drug delivery systems; anesthesia needles and trays; sharps disposal containers; and closed-system transfer devices.

*Company profiles were sourced from Finviz.

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