Yahoo Finance Zacks.com featured highlights include Marriott International, BorgWarner, Atkore, Upbound Group and Triton International
For Immediate Release
Chicago, IL – June 8, 2023 – Stocks in this week’s article are Marriott International, Inc. MAR, BorgWarner Inc. BWA, Atkore Inc. ATKR, Upbound Group, Inc. UPBD and Triton International Limited TRTN.
5 Stocks With High ROE to Buy as Markets Appear on Cruise Mode
The U.S. equity markets appear to have steadied after President Joe Biden signed the debt ceiling bill to avert a potential default on the federal government’s debt. A default would have made the government incapable of borrowing any more money or repaying its bills, endangering the global economy and affecting prices and mortgage rates in other countries. The markets were further propelled by a better-than-expected May jobs report that allayed the fears of recession from the near-term horizon to at least until 2024.
The jobs report revealed that payrolls in the public and private sectors increased by 339,000 in May, significantly higher than broad-based expectations of 190,000 rise. While professional and business services added 64,000 jobs, government and healthcare sectors contributed 56,000 and 52,000 job additions, respectively. Average hourly earnings, a key inflation indicator, improved 0.3% for the month and were in sync with expectations. The focus has now shifted to the Federal Reserve’s Jun 13-14 policy meeting, which is likely to be another potential market catalyst.
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. Marriott International, Inc., BorgWarner Inc., Atkore Inc., Upbound Group, Inc. and Triton International Limited are some of the stocks with high ROE to profit from.
ROE: A Key Metric
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 companies 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.
Here are five of the 10 stocks that qualified the screen:
Marriott: Headquartered in Bethesda, MD, Marriott is a leading worldwide hospitality company focused on lodging management and franchising. As of year-end 2022, the company's portfolio encompassed nearly 8,300 properties under 30 leading brands spanning 138 countries and territories.
It has a long-term earnings growth expectation of 15.5% and delivered a trailing four-quarter earnings surprise of 8%, on average. Currently, Marriott carries a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
BorgWarner: Michigan-based BorgWarner is a global leader in clean and efficient technology solutions required for combustion, hybrid and electric vehicles. Its products include four-wheel-drive and all-wheel-drive transfer cases (primarily for light trucks and sport utility vehicles or SUVs), as well as automatic transmission and timing chain systems.
The company has a long-term earnings growth expectation of 14.1% and delivered a trailing four-quarter earnings surprise of 15.3%, on average. It has a VGM Score of A. BorgWarner carries a Zacks Rank #2.
Atkore: Headquartered in Harvey, IL, Atkore offers conduits, cables, and installation accessories in the United States and internationally. With a network of manufacturing and distribution facilities worldwide, Atkore is a leading provider of electrical, safety and infrastructure solutions.
Atkore carries a Zacks Rank #2. It delivered a trailing four-quarter earnings surprise of 16.3%, on average.
Upbound Group: Formerly known as Rent-A-Center, Inc., Upbound Group is a leading lease-to-own provider with operations in the United States, Puerto Rico and Mexico. The company provides services to a large portion of consumers by providing them with access and the opportunity to obtain ownership of high-quality, durable products under a flexible lease purchase agreement with no long-term debt obligation.
The company delivered a trailing four-quarter earnings surprise of 16.1%, on average. It has a VGM Score of A. Upbound Group carries a Zacks Rank #2.
Triton: Based in Hamilton, Bermuda, Triton is the largest lessor of intermodal containers (large steel boxes used for transporting freight by ship/rail/truck). The company also focuses on leasing chassis, which are used for transporting containers. It offers leasing services through 19 offices and three independent offices in 16 countries.
The company delivered a trailing four-quarter earnings surprise of 6.3%, on average. Triton carries a Zacks Rank #2.
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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/2104901/5-stocks-with-high-roe-to-buy-as-markets-appear-on-cruise-mode
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Marriott International, Inc. (MAR) : Free Stock Analysis Report
BorgWarner Inc. (BWA) : Free Stock Analysis Report
Triton International Limited (TRTN) : Free Stock Analysis Report
Atkore Inc. (ATKR) : Free Stock Analysis Report
Upbound Group, Inc. (UPBD) : Free Stock Analysis Report
