Zacks.com featured highlights include Lantheus, Perion Network, Meta Platforms and Sea
For Immediate Release
Chicago, IL – March 21, 2023 – Stocks in this week’s article are Lantheus Holdings LNTH, Perion Network PERI, Meta Platforms META and Sea Ltd. SE.
4 Top-Ranked Liquid Stocks for Strong Returns in 2023
Investors looking for high returns will likely benefit from adding stocks with sound liquidity levels, as liquidity encourages business growth.
Liquidity primarily determines a company's capability to meet debt obligations by converting assets into liquid cash and equivalents. These stocks have always been on investors' radar owing to their potential to provide strong returns.
Investors should be alert before considering such stocks. While a high liquidity level may imply that the company is clearing its dues faster than its peers, it may also suggest that it cannot utilize its assets competently.
Hence, one may consider efficiency and liquidity to identify potential winners.
Measures to Identify Liquid Stocks
Current Ratio: It measures current assets relative to current liabilities. The ratio gauges a company's potential to meet short- and long-term debt obligations. A current ratio — also known as the working capital ratio — below 1 indicates that the company has more liabilities than assets. However, a high current ratio does not always suggest that the company is in good financial shape. It may also suggest that the firm failed to utilize its assets significantly. Hence, a range of 1-3 is considered ideal.
Quick Ratio: Unlike the current ratio, the quick ratio — also called the 'acid-test ratio' or 'quick assets ratio' — indicates a company's ability to pay short-term obligations. It considers inventory, excluding the current assets relative to current liabilities. Like the current ratio, a quick ratio of more than 1 is desirable.
Cash Ratio: This is the most conservative ratio among the three, considering cash and cash equivalents and invested funds relative to current liabilities. It measures a company's ability to meet current debt obligations using the most liquid assets. Though a cash ratio of more than 1 may suggest sound financials, a higher number may indicate inefficiency in cash utilization.
A ratio greater than 1 is always desirable but may not always represent a company's financial condition.
These criteria have narrowed the universe of more than 7,700 stocks to only five.
Here are four of the five stocks that qualified for the screen:
Lantheus Holdings is involved in developing, manufacturing, selling and distributing diagnostic medical imaging agents and products for diagnosing cardiovascular and other diseases. It serves hospitals, clinics, group practices, integrated delivery networks, group purchasing organizations, radiopharmacies and wholesalers.
The Zacks Consensus Estimate for Lantheus Holdings' 2023 earnings has been revised upward to $4.79 per share from $3.47 in the past 60 days. The company has a Growth Score of A and a trailing four-quarter earnings surprise of 50%, on average.
Perion Network is an Israel-based technology company that offers brands and publishers online advertising and search monetization solutions. The company is committed to providing data-driven execution, from high-impact ad formats to branded search and a unified social and mobile programmatic platform.
The Zacks Consensus Estimate for its 2023 earnings is pegged at $2.69 per share, up 15.9% in the past 60 days. The company has a Growth Score of A and a trailing four-quarter earnings surprise of 31.7%, on average.
Meta Platforms is benefiting from steady user growth across all regions, particularly Asia Pacific. Increased engagement for its products like Instagram, WhatsApp, Messenger and Facebook is likely to drive digital ad revenues. The company's extensive cost-cutting measures also bode well. Meta recently announced another round of layoffs that will likely impact nearly 10k employees in addition to 11k laid off in November 2022.
The Zacks Consensus Estimate for 2023 earnings is pegged at $10.38 per share, up 31% in the past 60 days. META has a Growth Score of B and a trailing four-quarter earnings surprise of 8.6%, on average.
Sea Ltd. is an internet service provider company based in Singapore. It offers Digital Entertainment, E-Commerce and Digital Financial Services known as Garena, Shopee and AirPay. The company operates primarily in Indonesia, Taiwan, Vietnam, Thailand, Philippines, Malaysia and Singapore.
The Zacks Consensus Estimate for 2023 bottom line is pegged at $2.96 per share, suggesting an improvement from a loss of 13 cents 60 days ago. SE has a Growth Score of B and a trailing four-quarter earnings surprise of 69.7%, on average.
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For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/2067854/4-top-ranked-liquid-stocks-for-strong-returns-in-2023
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