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Zacks.com featured highlights include: Medifast, USANA Health, UFP Industries, AllianceBernstein and Landstar System

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For Immediate Release

Chicago, IL – August 5, 2020 – Stocks in this week’s article are Medifast, Inc. (MED - Free Report) , USANA Health Sciences, Inc. (USNA - Free Report) , UFP Industries, Inc. (UFPI - Free Report) , AllianceBernstein Holding L.P. (AB - Free Report) and Landstar System, Inc. (LSTR - Free Report) .

Must-Buy Quality Stocks Screened on DuPont Analysis

In a market, complacency levels may falter any time if medical metrics worsen or stimulus hope stalls. Herein, picking the right stock becomes a challenge. In such a scenario, return on equity is a proven metric to guide investors to the right stock.

The metric enables investors to differentiate between a profit-churner and a profit-burner. It is a profitability ratio that measures the earnings that a company generates from its equity.

But to fine-tune this basic concept, one can depend on DuPont analysis. This theory will take investors a step higher and better pick some quality stocks. 

Here is how DuPont breaks down ROE into its different components:

ROE = Net Income/Equity

Net Income / Equity = (Net Income / Sales) * (Sales / Assets) * (Assets / Equity)

ROE = Profit Margin * Asset Turnover Ratio * Equity Multiplier

Inside the Strength of DuPont

The DuPont analysis allows investors to evaluate the elements that are the driving factors in any change in ROE. It can help investors to separate companies having higher margins from those having a high turnover. In fact, it also focuses on the company’s leverage status. A lofty ROE could be due to the overuse of debt. If this is the case, the strength of a company can be uncertain if it has a high debt load.

So, an investor relying solely on basic ROE may be confused if he or she has to judge between two stocks of an equal ratio. This is where DuPont analysis wins while finding out the better stock.

Investors can simply do this analysis by taking a look at the company’s financials. However, looking at the financial statements of each company separately can be a tedious task. Screening tools like Zacks Research Wizard can come to your rescue and help you shortlist the stocks that look impressive with a DuPont analysis.

For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/1035175/6-mustbuy-quality-stocks-screened-on-dupont-analysis

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.

Strong Stocks that Should Be in the News

Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year. See these high-potential stocks free >>.

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