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TheStreet Open House

10 Stocks With Highest Profitability Ratios

Stock quotes in this article: MNTA, ARB, AVGO, GPOR, TPX, FCFS, WBC, VRA, IPGP, SPRD

2. IPG Photonics (IPGP) is a world leader in high-power fiber lasers and amplifiers. It has a market cap exceeding $1.6 billion. The company sells its products globally to original equipment manufacturers, system integrators and end users. Its diverse lines of low-, mid- and high-power lasers and amplifiers are used in materials processing, advanced communications and medical applications.

For the last 12 months, the company had ROA of 23.44%, while asset turnover ratio was 0.93. For the same period, ROE and ROCE were 32.32% and 31.46%, respectively. The stock is trading at 14.60 times earnings, vs. the industry P/E of 15.34, according to data compiled by Bloomberg.

For the third quarter, IPGP reported revenue of $129.1 million, up 62% from $79.8 million in the same quarter previous year. Net income attributable to the company rose to $32.9 million from $13.2 million in the year-ago quarter. EPS increased to 66 cents from 28 cents.

For the fourth quarter, the company expects net revenue in the range of $122 million to $135 million and diluted EPS of 60 cents to 71 cents. The company's CEO Dr. Valentin Gapontsev recently said, "We anticipate that our growth will continue to be led by our high power laser products, particularly for materials processing applications. As always, we are planning for the long term. Our strategy is to invest in R&D and capacity expansion to further solidify our technology superiority and our position as the leader in fiber lasers."

Of the 10 analysts covering the stock, eight recommend a buy and two rate a hold. Analysts polled by Bloomberg foresee the stock gaining an average 61.3% to $57 in the upcoming 12 months.

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