For Immediate Release
Chicago, IL – November 5, 2020 – Stocks in this week’s article are The Sherwin-Williams Company (
SHW Quick Quote SHW - Free Report) , Best Buy Co., Inc. ( BBY Quick Quote BBY - Free Report) , Lam Research Corporation ( LRCX Quick Quote LRCX - Free Report) , KLA Corporation ( KLAC Quick Quote KLAC - Free Report) and Whirlpool Corporation ( WHR Quick Quote WHR - Free Report) . Top 5 ROE Stocks as Presidential Election Count Continues
The U.S. equity markets surged in the past few trading sessions on optimism surrounding the Presidential elections. Despite broad-based expectations of a resolution of the uncertainty clouding the battle for White House supremacy, the markets have largely factored in near-term volatility as major policy matters related to taxes, government spending, trade and regulation could get modified. In addition, rising coronavirus cases continue to impede the pace of economic recovery despite a better-than-expected overall quarterly performance across the board.
As investors employ a wait-and-see approach in a classic example of “backing and filling” in the market, they can benefit from ‘cash cow’ stocks that garner higher returns. However, identifying cash-rich stocks alone does not make for a solid investment proposition unless it is backed by attractive efficiency ratios like return on equity (ROE). A high ROE ensures that the company is reinvesting cash at a high rate of return.
ROE = Net Income/Shareholders’ Equity
ROE helps investors distinguish profit-generating companies from profit burners and is useful in determining the financial health of a company. In other words, this financial metric enables investors to identify stocks that diligently deploy cash for higher returns.
Moreover, ROE is often used to compare the profitability of a company with other firms in the industry — the higher, the better. It measures how well a company is multiplying its profits without investing new equity capital and portrays management’s efficiency in rewarding shareholders with attractive risk-adjusted returns.
For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/1096232/top-5-roe-stocks-to-buy-as-us-votes-for-next-president 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
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