Zacks.com Highlights: Broadcom, Arkema SA, Johnson Outdoors, Modine Manufacturing And DAQO New Energy

For Immediate Release

Chicago, IL – Jan 15, 2018 - Stocks in this week’s article include: Broadcom Limited (NASDAQ:AVGO) , Arkema SA (OTC:ARKAY) , Johnson Outdoors Inc. (NASDAQ:JOUT) , Modine Manufacturing Company (NYSE:MOD) and DAQO New Energy Corp. (NYSE:DQ) .

Screen of the Week of Zacks Investment Research:

5 Top Stocks With Impressive Net Profit Margin

The primary purpose of a business is to generate profits that can be reinvested in the expansion or utilization of rewarding shareholders. Net profit margin is an effective tool for the measurement of profits generated by a business.

Net Profit Margin = Net profit /Sales * 100.

In simple terms, net profit is the amount a company retains after deducting all costs, interest, depreciation, taxes and other expenses. In fact, net profit margin can turn out to be a potent point of reference to gauge the strength in a company operations and cost-control measures.

Also, higher net profit is essential for rewarding stakeholders. Net margin helps investors judge the risk involved in an investment. Creditors also view it as crucial to determining a company’s ability to pay off debts.

Moreover, a higher net profit margin compared to its peers lends the company a competitive edge.

Pros and Cons

Net profit margin helps investors gain clarity on a company’s business model in terms of pricing policy, cost structure and manufacturing efficiency. Hence, a strong net profit margin is preferred by all classes of investors.

However, net profit margin as an investment criterion has its own share of pitfalls. The metric varies widely from industry to industry. While net income is a key metric for investment measurement in traditional industries, it is not that important for technology companies.

Moreover, the difference in accounting treatment of various items — especially non-cash expenses like depreciation and stock-based compensation — makes comparison a daunting task.

Further, for companies preferring to grow with debt instead of equity funding, higher interest expenses usually weigh on net profit. In such cases, the measure is rendered ineffective to analyze a company’s performance.

And that's what we're screening for today…

For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/264251/5-top-stocks-with-impressive-net-profit-margin

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Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.

About Screen of the Week

Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine. But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use.

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