For Immediate Release
Chicago, IL – July 3, 2018 - Stocks in this week’s article Johnson Outdoors Inc. (JOUT - Free Report) , At Home Group Inc. (HOME - Free Report) , Inogen, Inc. (INGN - Free Report) , Blucora, Inc. (BCOR - Free Report) and Weight Watchers International, Inc. (WTW - Free Report) .
5 Profitable Stocks to Scoop Up Spectacular Returns
Profitability analysis is one of the best tools to evaluate the future movement of a stock. Using profitability analysis, we can evaluate the total expenses borne and the total revenue generated by a company. High sales surplus is definitely good news for a company as it raises chance of it making more profits after meeting its costs and expenses.
In this respect, it is wise to invest in shares of a company with high level of profitability as it normally ensures high returns. However, an encouraging profitability condition may not always guarantee good returns if a company is fundamentally weak.
As a result, the simplest and most transparent way of checking a company’s profitability is by using accounting ratios. There are a variety of profitability ratios, from which we have selected net income ratio here as it is the most useful and simplest profitability metric.
Net Income Ratio
There are a variety of profit ratios like gross income ratio, operating income ratio, pretax profit margin and net income ratio, which can be used to find out a company’s profit-generating abilities. But net income ratio is widely accepted as the most conservative of the above-mentioned ratios.
Net income in simple words is total earnings a company makes after deducting all the expenses from its sales revenue. Net income ratio or net profit margin is a ratio of a company’s net income and sales revenue. A high net income ratio shows that the company is able to effectively manage all its business activities, including production, administration, selling, etc.
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