10 Stocks With Highest Profitability Ratios

NEW YORK ( TheStreet) - For the last 12 months, these 10 stocks from diverse industries had the highest return on assets of 23% to 80%, return on equity ranging from 28% to 252% and return on capital employed ranging from 31% to 71%. These stocks have upside potential in the range of 23% to 61%, based on average estimates of analysts polled by Bloomberg.

Below, we've listed them in ascending order of upside potential.

10. Momenta Pharmaceuticals ( MNTA) is a biotechnology company with a market cap exceeding $891 million. It specializes in the analysis of complex mixture drugs and the development of novel drugs.

The company's return on assets in the last 12 months was 79.80%, while total asset turnover ratio was 1.14. Return on equity and return on capital employed in the last 12 months stood at a healthy 85.32% and 86.35%, respectively. The stock is trading at 4.01 times earnings, vs. the industry average P/E of 22.24, according to data compiled by Bloomberg.

For the latest third quarter, Momenta reported revenue at $87.9 million, up 69.3%. Net income was $60.3 million, or $1.18 per diluted share, compared with $32.1 million, or 70 cents per share, for the same period last year.

Momenta recently announced a global collaboration with Baxter International to develop and commercialize follow-on biologic products, or biosimilars, which replicate existing, branded biologics used in the treatment of a variety of diseases including cancer, autoimmune disorders and other chronic conditions. The company has announced an agreement to acquire the Sialic Switch assets of Virdante Pharmaceuticals for $51.5 million.

Of the 10 analysts covering the stock, seven recommend a buy and three rate a hold. Analysts polled by Bloomberg foresee the stock gaining an average 23.1% to $21.71 in the upcoming 12 months.

9. Arbitron ( ARB) is a media and marketing research firm with a market cap exceeding $937 million. The company offers services to media -- radio, television, cable and out-of-home -- as well as the mobile industry and advertising agencies and advertisers worldwide.

For the last 12 months, the company's ROA was 25.67%, while total asset turnover ratio was 1.94 . ROE and ROCE for the same period came in at 61.52% and 72.58%, respectively. The stock is trading at 17.38 times earnings, vs. the industry P/E of 149.89, based on data compiled by Bloomberg.

For its third quarter, Arbitron reported revenue of $105.1 million, an increase of 6.1% compared to revenue of $99.5 million during the 2010 third quarter. Net income was $15.4 million, improving from $11.3 million in the same period previous year. Earnings per share for the quarter came in at 55 cents, vs. 42 cents in the year-earlier period.

The company expects 6% to 8% increase in revenue for the full year 2011 vs. 2010 and estimates EPS between $1.90 and $2.05. The company has announced a quarterly cash dividend of 10 cents per share payable Jan. 3 to share holders of record Dec. 15.

Of the nine analysts covering the stock, seven recommend a buy and two rate a hold. Analysts polled by Bloomberg foresee the stock gaining an average 25.8% to $45.67 in the upcoming 12 months.

8. Avago Technologies ( AVGO) is a designer, developer and global supplier of analog semiconductor devices with a market cap exceeding $7 billion. Its portfolio includes over 6,500 products targeting four primary markets: wireless communications, wired infrastructure, industrial and automotive electronics and consumer and computing peripherals.

The company's ROA for the last 12 months was 23.98%, while total asset turnover ratio was 1.01 for the same period. ROE and ROCE for the last 12 months were 31.44% and 51.52%, respectively. The stock is trading at 12.71 times earnings, vs. the industry P/E of 15.41, according to data compiled by Bloomberg.

Quarterly net revenue was up 3.3% sequentially in the fourth quarter. Revenue grew to $623 million from $603 million in the same quarter prior year. Net income increased to $154 million, or 61 cents, up 6.9% from the prior year.

For full year 2011, net revenue improved 12% to $2.33 billion from $2.09 billion in the previous fiscal, rising 33% to $552 million, or $2.19 per share, compared to $415 million, or $1.69 per share. Recently, the company paid a quarterly interim cash dividend of 12 cents per ordinary share.

Avago has announced three new digital optocouplers optimized for use in onboard chargers and other high-voltage systems in hybrid and electric vehicles. Avago was recently included in the Nasdaq 100, effective Dec. 19.

Of the 17 analysts covering the stock, 76% recommend a buy and 24% rate a hold. Analysts have average 12-month price target of $37.64 for the stock, about 30% higher than the current price, according to a Bloomberg consensus.

7. Gulfport Energy ( GPOR) is an independent oil and natural gas exploration and production company with a market cap exceeding $1.6 billion. The company's principal producing properties are located along the Louisiana Gulf Coast in the West Cote Blanche Bay, Hackberry fields, and in West Texas in the Permian Basin.

For the last 12 months, the company's ROA was 21.70%, while asset turnover ratio was 0.47. ROE and ROCE for the period stood at 27.27% and 31.12%, respectively. The stock is trading at 15.26 times earnings, vs. the industry P/E of 41.17, data compiled by Bloomberg show.

For the 2011 third quarter, Gulfport reported total revenue of $58 million, an increase of 74.1% from the same quarter prior year. Net income rose 130% to $29 million. EPS for the quarter was reported at 57 cents compared to 28 cents in 2010. Net production for the quarter was 545,362 barrels of oil, 196,418 thousand cubic feet of natural gas and 505,270 gallons of natural gas liquids, or 590,128 barrels of oil equivalent.

The company recently announced the commencement of an underwritten public offering of 5 million shares priced at $29 per share, with 4 million shares to be sold by Gulfport and 1 million shares by one of its stockholders.

Gulfport estimates 2012 oil production to be in the range of 3 million to 3.2 million boe. Capital expenditure for 2012 is seen between $215 million and $225 million. Operationally, the company plans to drill 22 to 24 wells at West Cote Blanche Bay, 10 to 12 wells at Hackberry, 23 to 25 wells in the Permian basin, 6 to 7 wells in the Niobrara and about 20 wells in the Utica Shale.

Of the 14 analysts covering the stock, 86% recommend a buy and 14% rate a hold. Analysts polled by Bloomberg foresee the stock gaining an average 31.1% to $40.00 in the upcoming 12 months.

6. Tempur-Pedic International ( TPX) is a manufacturer, marketer of pillows with a market cap exceeding $3.4 billion. It sells its products under the Tempur and Tempur-Pedic brands in over 80 countries.

The company had ROA of 27.14% in the last 12 months, while total asset turnover ratio was 1.74. For the same period, ROE and ROCE were 252.47% and 71.14%, respectively. Currently, the stock is trading at 17.51 times earnings compared to the industry P/E of 20.74, data compiled by Bloomberg show.

For the 2011 third quarter, net sales increased 30% to $383.1 million from $295.8 million in the same quarter preceding year. The company reported net income of $61.9 million compared to $44.2 million in same period last year. EPS increased 45% to 90 cents during the third quarter from 62 cents in the same quarter of 2010. Globally, mattress sales increased 28% and pillow sales grew 12% during the quarter.

Recently, the company announced its board of directors increased the existing repurchase program by $80 million to a total $280 million. The company plans to add 100 jobs at its factory in Albuquerque and fill nearly 50% of the positions in 2012.

For full year 2011, the company expects net sales to range from $1.40 billion to $1.45 billion and sees EPS in the $3.12 to $3.17 per diluted share range.

Of the 15 analysts covering the stock, 73% recommend a buy and 27% rate a hold. There were no sell recommendations for the stock. Analysts polled by Bloomberg foresee the stock gaining an average 38.3% to $76.33 in the upcoming 12 months.

5. First Cash Financial Services ( FCFS) is a specialty retailer and provider of consumer financial services with a market cap exceeding $1 billion. The company operates pawn stores that engage in retail sales, purchase of used goods, and consumer finance.

The company's ROA was 23.55% for the last 12 months, while asset turnover ratio was 1.57. ROE and ROCE for the same period were 27.28% and 36.17%, respectively. The stock is trading at 16.25 times earnings, vs. the industry P/E of 21.66, according to data compiled by Bloomberg.

For 2011 third quarter, the company reported 25.7% increase in revenue to $133.3 million from $106 million in the prior-year period. Net income from continuing operations in the quarter was $18.3 million, rising 38% over the 2010 quarter. Diluted earnings per share grew to 59 cents from 43 cents in the year-ago quarter.

The company added 21 pawn stores during the third quarter taking total store count to 667, of which 557 were pawn stores. In the last 12 months, the company opened and acquired 88 new stores. In October, FCFS signed an agreement to acquire a chain of five retail pawn stores located in Indianapolis, Ind., at a purchase price of $4 million.

The company has increased its fiscal 2011 earnings per share guidance to be in the range of $2.23 to $2.25 from the previous estimate of $2.16 to $2.20 per share. Moreover, it estimates a 29% increase in new stores over total store additions for 2010. In December, the company announced the repurchase of up to 1.5 million shares of its common stock

Of the 12 analysts covering the stock, 75% recommend a buy and 25% rate a hold. There are no sell ratings for the stock. Analysts polled by Bloomberg foresee the stock gaining an average 40% to $49.00 in the upcoming 12 months.

4. WABCO Holdings ( WBC), with a market cap exceeding $2.8 billion, is a provider of electronic and mechanical products for the commercial truck, trailer, bus and passenger car manufacturers. The company manufactures and sells control systems, including advanced braking, stability, suspension, transmission control and air compressing and processing systems.

In the last 12 months, WABCO had ROA of 21.38%, while total asset turnover ratio was 1.67. For the same period, ROE and ROCE were 78.21% and 59.56%, respectively. The stock is trading at 10.33 times earnings against the industry P/E of 13.42, according to data compiled by Bloomberg.

For the 2011 third quarter, total sales stood at $706.3 million, compared to $545.2 million reported in same quarter previous year. Net income rose 90.4% to $83.8 million. Earnings per diluted share increased to $1.25 from 68 cents reported in the 2010 quarter. The company repurchased 1.6 million shares at a total cost of $80 million.

WABCO will supply its Adaptive Cruise Control to Yutong in China -- the world's largest manufacturer of buses -- as part of an expanded long-term agreement to furnish advanced safety technologies. The company has also announced that it will supply Trailer Electronic Braking Systems with its roll stability support function to Krone, a leading European manufacturer of agricultural trailers and machinery.

The company's sales guidance for full year 2011 is 22% to 25% higher, while EPS is expected to range from $4.55 to $4.80 per diluted share. Operating margin is seen hovering at around 13.2% to 13.8%.

All the eight analysts covering the stock have a buy on it. There are no sell or hold recommendations. Analysts polled by Bloomberg foresee the stock gaining an average 42.7% to $63.71 in the upcoming 12 months.

3. Vera Bradley ( VRA) is a designer, producer, marketer and retailer of accessories for women including handbags, accessories, and travel and leisure items. It has a market cap of over $1.3 billion. The company sells its products through 48 retail stores in the U.S., eight outlet stores, 3,400 specialty retailers and online.

The company had ROA of 25.89% for the last 12 months, while total asset turnover ratio was 2.17. For the same period, ROE and ROCE were 67.84% and 34.40%, respectively. Currently, the stock is trading at 25 times earnings, compared to the industry P/E of 17.67, according to data compiled by Bloomberg.

For the third quarter ended in October, the company reported 32% increase in net revenue, or $29.5 million, to reach $121.1 million. Net income for the quarter was $13 million, or 32 cents per diluted share, compared to $6 million, or 17 cents in the prior year.

Vera has opened 13 full-price and four outlet stores since the third quarter of last year, increased traffic in its e-commerce business, improved conversion rates in all channels, and saw a 7.4% increase in comparable-store sales.

For the fourth quarter, the company expects net revenue to be in the range of $125 million to $130 million and diluted EPS of 44 cents to 47 cents. For fiscal 2012, the company expects net revenue of $451 million to $456 million and sees diluted earnings per share between $1.37 and $1.40.

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 47.1% to $47.67 in the upcoming 12 months.

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.

1. Spreadtrum Communications ( SPRD) is a China-based fabless semiconductor company with a market cap exceeding $1 billion. It combines its semiconductor design expertise with its software development capabilities to deliver highly integrated baseband processors with multimedia functionality and power management for the wireless communications market.

For the last 12 months, the company's ROA was 23.91%, while total asset turnover ratio was 1.13. For the same period, ROE and ROCE were 58.82% and 84.22%, respectively. Currently, the stock is trading at 8.66 times earnings, vs. the industry P/E of 25.7, data compiled by Bloomberg show.

For the third quarter, the company reported total revenue of $184.8 million, up 92% year-over-year and 15.4% quarter-over-quarter. Net income rose to $39.3 million from $32.5 million in the previous year's quarter and $19.5 million in the 2010 third quarter. Net income per diluted ADS grew to 75 cents from 37 cents in the prior year quarter.

Sales volume of 2G/2.5G baseband and radio frequency bundle semiconductors increased 19.1% quarter-over-quarter and 121.7% year-over-year. Sales volume of 3G bundle semiconductors increased 17.8% in third quarter and 101.1% year-over-year. The company recently announced commercial availability of two low-cost Android smartphone platforms.

Recently, the company declared a quarterly cash dividend of 10 cents per ADS payable Jan. 24, to holders of record of ordinary shares as of close of business Jan 9. Looking ahead, Spreadtrum expects fourth-quarter 2011 revenue to be in the range of $188 million to $194 million with a gross margin of approximately 41%.

Of the 16 analysts covering the stock, 88% recommend a buy and 12% rate a hold. Analysts polled by Bloomberg foresee the stock gaining an average 61.4% to $31.65 in the upcoming 12 months.

>>To see these stocks in action, visit the 10 Stocks With Highest Profitability Ratios portfolio on Stockpickr.