If you want to have a higher chance to discover companies that are in good shape from a financial standpoint, you may want to consider the following four stocks, as their trailing 12-month (TTM) Ebitda margins are topping the S&P 500's 20.4% as of the writing of this article.
The Ebitda margin, which is calculated as earnings before interest, tax, depreciation and amortization divided by total revenue, is a good indicator of a company's financial health as it doesn't consider the effect of unique decisions and tax laws when assessing the performance of a company. These decisions refer to the recognition of amortization and depreciation, which may differ significantly, even among companies that operate in the same industry.
Wall Street sell-side analysts have also issued positive recommendation ratings for these stocks.
Anheuser-Busch InBev SA/NV
The first company that makes the cut is Anheuser-Busch InBev SA/NV (BUD, Financial), a Belgian global producer of beer, alcoholic beverages and soft drinks.
Anheuser-Busch InBev SA/NV's Ebitda margin is 28.2% as a result of Ebitda per share of $7.30 and revenue per share of $25.85 for the trailing 12 months ended in June 2021.
The share price, $59.87 at close on Friday, is a 7.41% increase compared to year-ago levels. The company has a market capitalization of $118.21 billion and a 52-week range of $51.45 to $79.67.
The stock grants a trailing dividend yield of 1%. The company last paid an annual dividend of 60.1 cents per common share on June 3.
On Wall Street, the stock has a median recommendation rating of overweight and an average target price of $76.63 per share.
Edwards Lifesciences Corp
The second company that makes the cut is Edwards Lifesciences Corp (EW, Financial), an Irvine, California-based manufacturer of medical devices.
Edwards Lifesciences Corp's Ebitda margin is 26.2% as a result of Ebitda per share of $2.04 and revenue per share of $7.78 for the trailing 12 months ended in June 2021.
The share price, $121.07 at close on Friday, represents a 47.4% increase compared to year-ago levels for a market capitalization of $75.47 billion and a 52-week range of $70.92 to $121.37.
Edwards Lifesciences Corp does not pay dividends.
On Wall Street, the stock has a median recommendation rating of overweight and an average target price of $121.67 per share.
Mobile TeleSystems PJSC
The third stock that qualifies is Mobile TeleSystems PJSC (MBT, Financial), a Russian domestic provider of telecommunication services.
Mobile TeleSystems PJSC's Ebitda margin is 44.3% as a result of Ebitda per share of $3.45 and revenue per share of $7.79 for the trailing 12 months ended in June 2021.
The share price, $9.33 at close on Friday, represents a 7.12% increase compared to year-ago levels for a market capitalization of $8.06 billion and a 52-week range of $7.72 to $9.70.
The stock's trailing dividend yield of 10.19% is calculated from a semi-annual dividend of 71.8 cents per common share paid on July 30 and a semi-annual dividend of 23.3 cents per common share paid on Oct. 30, 2020.
On Wall Street, the stock has a median recommendation rating of overweight and an average target price of approximately $11 per share.
Cricut Inc.
The fourth stock that makes the cut is Cricut Inc. (CRCT, Financial), a South Jordan, Utah-based provider of connected machines, design apps, heat transfer systems and materials to create personalized birthday cards, mugs, T-shirts and various decorations.
Cricut Inc.'s Ebitda margin is 22.8% as a result of Ebitda per share of $1.29 and revenue per share of $5.67 for the trailing 12 months ended in June 2021.
The share price, $30.63 at close on Friday, represents a 72.08% increase compared to year-ago levels for a market capitalization of $6.81 billion and a 52-week range of $18 to $47.36.
Cricut Inc does not pay dividends.
On Wall Street, the stock has a median recommendation rating of overweight and an average target price of about $33.20 per share.
Disclosure: I have no positions in any securities mentioned in this article.
