5 Fast-Growing Profit Gushers: Intuitive Surgical, Inc. (ISRG), Silver Wheaton Corp. (USA) (SLW), Seadrill Ltd (SDRL)

Page 1 of 2

When you seek out compelling candidates for your stock portfolio, there are lots of numbers you can assess — price-to-earnings ratios, debt-to-equity ratios, free cash flow, and so on. To gather a manageable list of possibilities, you might want to employ a screen that will narrow down the universe of stocks according to whichever criteria you set. I did just that recently, and arrived at a handful of interesting companies that are growing rapidly and reaping hefty profits.

Intuitive Surgical, Inc. (NASDAQ:ISRG)At finviz.com, I screened for stocks with:

A market capitalization of at least $300 million. This includes many small companies but not tiny ones.
Revenue growth over the past five years of at least 10%. This is a good measure because it’s hard to grow your bottom line if your top line isn’t growing.
Earnings-per-share (EPS) growth over the next five years expected to be positive — because why aim for companies expected to experience shrinking EPS?
Net profit margins of more than 15%. Net margins reflect how much of each dollar of revenue is retained as earnings.

Why fat margins?
It’s a big plus for a portfolio candidate to have a hefty net margin — for several reasons. For starters, it tends to reflect some competitive advantage, such as brand power or a business model that’s not too capital intensive and scales efficiently, perhaps one with relatively fixed costs. Think of a software company, for example. Once it develops some software, for it to double its sales it doesn’t have to double all the work that went into developing the software. It just has to make it available via a disk or a download or some other inexpensive means of delivery. A big margin also gives a company some wiggle room, permitting it to lower costs when necessary, without a lot of pain.

Profit gushers
Here are a few companies that my screen produced. See if any of them interest you, and perhaps add them to your watch list or portfolio.

Baidu.com, Inc. (ADR) (NASDAQ:BIDU) , the Chinese search engine giant, sports a five-year average annual revenue growth rate of 72% and a net profit margin of 46.6%. Its stock is down about 42% from its 52-week high, partly on concerns about China’s slowing growth rate. Baidu has seen some decelerating  revenue growth recently, but its long-term prospects are good, as much of China and Asia have yet to get online, representing further growth potential. Better still, many of its numbers outshine those of Google Inc (NASDAQ:GOOG), though it does have serious competition, too.

Silver Wheaton Corp. (USA) (NYSE:SLW) sports a five-year average annual revenue growth rate of 39% and a net profit margin of 73.3%. This precious metals specialist’s business model is rather beautiful, as instead of being involved in relatively risky and capital-intensive mining, it simply buys the rights to income from mines in exchange for financing. It has many investors excited recently, too, with a new deal it struck with Vale for rights to big chunks of Vale’s gold production at two mines — and management is very bullish, thinking there’s a big chance that the mines will overproduce.

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

10 Most Influential Papers In Economics

Top 8 Biggest Charities in the US

10 Worst Celebrity Career Moves Ever

Top 10 Best Paid Tennis Stars in the World

10 Cities with High Demand for Nurses

6 of the Worst Greeting Card Messages Ever Crafted

6 Ways to Make Money in ArcheAge and Build Your Empire

10 Foods To Eat To Lower Cholesterol Levels

The 10 Most Hated Television Characters of All Time

The 30 Worst Halloween Costume Ideas Ever Brought to Horrible Life

10 Vocational Skills in Demand Today with Jobs Waiting to be Filled

10 Best Places to Visit in Central and South America

The 10 Greatest Empires in History Which Nearly Conquered the World

The 6 Cheapest Boarding Schools In America 2015

5 Clear Reasons LoL is Better than DotA, Continues to Rule MOBAs

The Only 9 Teams with a Chance to Win the Super Bowl

The 15 Most Common Phobias in America that Induce Fits of Panic

Top 6 Least Expensive Tourist Destinations in 2014

Jim Goetz, Peter Fenton, Jim Breyer: Top 6 Venture Investors for 2014

Top 15 Billionaires in 2014

5 Pitfalls To Avoid When Buying a Franchise

Top 20 Medical Schools in the US – 2014 Rankings

4 Business Strategies that Turned Jamie Oliver into the World’s Richest Chef

6 Qualities That Make You A Good Team Player

10 High Paying Seasonal Jobs in America this Holiday Season

The 10 Busiest Shipping Lanes in the World

5 Most Valuable Brands in China

The 10 States with Highest Substance Abuse Rates Crippling Their Populace

The Top 10 Things to Do Before You Die That Will Echo for Eternity

The 10 Best Selling Items on Etsy

Top 10 Things to Do in Tokyo, the Greatest City in the World

10 Mistakes on Social Media that Can Harm You and Will Probably Get You Canned

The 10 Best Cities to Find Jobs in 2014

The 10 Most Controversial Songs Of All Time to Hit (and get Banned from) the Airwaves

The 20 Biggest IPOs in US History

The 10 Best Places to Visit in Mexico that Are Beautiful and Safe

7 Bad Habits that Age You Beyond Your Years

The 40 Best Fortune Cookie Sayings That Will Leave You Bemused, Befuddled, or Beguiled

10 Foods to Eat Before a Workout to Make Every Drop of Sweat Count

The 5 Best Documentaries On Netflix You Must See

The Most Heartwarming and Inspirational Story Of This Halloween Season, It Will Make You Cry and Jump For Joy

10 Best Party Songs of All Time to Bring the House Down With

5 New World Order Conspiracy Theories that Will Strangle the World

The 10 Highest Rated Movies of 2014

The 10 Largest Container Shipping Companies in the World

The 10 Largest Armies in the World: Who Should We Be Afraid Of?

Best Warren Buffett Quotes on Money You Need to Hear

The 10 Highest Suicide Rates by Profession

The 20 Most Underrated Movies of All Time

The 10 Fastest Growing Companies in America

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!