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Large-Cap Stocks With Excellent Management To Buy Now

Many investors constantly attempt to find investments on the equity securities market that provide stability, as well as profitability, for their capital. Fortunately, Zacks customers can utilize our Premium Screens to search for stocks that provide security on their initial principle.

Large-cap stocks are usually considered less volatile because of their dominant total market capitalization compared to middle and small-cap stocks, and we can use the “Management Excellence Premium Screen” to find large-cap companies that are known to administer their entity successfully.

Companies that exhibit prime management tend to have certain characteristics, such as high RoE, low Debt/Equity, and a high current ratio. Companies that possess strong management are also known to reward their shareholders with increased capital gains and impressive dividends.

Here are 5 large-cap stocks with excellent management to buy now:

1.       Applied Materials, Inc. AMAT

Applied Materials develops, manufactures and sells semiconductor wafer fabrication equipment and spare parts for the semiconductor industry. Applied Materials participates in the wafer fabrication industry, which is ranked in the top 1% of the Zacks Industry Rank. Also, Applied Materials has continued to be a model of consistency as it has topped our earnings projections in each of its fifteen operational quarters. Furthermore, as of 60 days ago, Applied Materials’ full-year EPS estimates have increased by 16.60% to an impressive $3.09.

Currently, Applied Materials is a global leader in semiconductor equipment sales. In fact, the company is the number one supplier to the global semiconductor industry and has been in that position for over twenty years. The firm possesses a very strong balance sheet, including a dept/cap ratio of 31.7% and $3.74 billion in cash and short-term investments. Finally, Applied Material returned $2.3 billion through stock repurchases and dividends to shareholders throughout 2016. Applied Materials currently sports a Zacks Rank #1 (Strong Buy).

2.       Arista Networks, Inc. ANET

Arista Networks, Inc. is involved in providing cloud networking solutions for datacenter and other cloud computing environments. This company has demonstrated several basic characteristics of management excellence. For example, Arista has a RoE of 17.55% and projected EPS growth of 20.18%, which compares favorably to the industry averages of 2.75% and 0.35%, respectively. Arista has also surpassed our earnings projections in each of its past twelve operational quarters by an average of 31.16%.

Currently, Arista sports an enormous projected full-year sales growth of 30.23%. Furthermore, the company holds a current ratio of 3.26 compared to the industry average of 2.21. This means that Arista possesses over three times as much assets as it does liabilities. Arista’s share price has also exploded by 129.96% over the past year, but now might still be the right time to buy this Zacks Rank #2 (Buy) stock.

3.       Momo Inc. MOMO

Momo Inc. provides a mobile-based social networking platform that is primarily utilized in China. Momo’s share price has witnessed an incredible jump, increasing by a whopping 284.26% over the past year. Also, the company sports an “A” grade for Growth, which means that the company is projected to continue expanding and developing. Momo has also seen astronomical current cash flow growth of 655.52% and full-year projected sales growth of 126.24%, both of which tower over their respective industry averages.

Additionally, Momo’s net margin sits at an impressive 28.59%, while the company holds an earnings yield of 3.79%. This means that Momo is retaining over 28% of its revenue as profit while increasing earnings for its shareholders. Currently, Momo Inc. features a Zacks Rank #1 (Strong Buy).

4.       Cummins Inc. CMI

Cummins Inc. is one of the world leaders in designing and manufacturing diesel engines. At the end of 2016, Cummins acquired the final distributor joint venture in North America, which helped increased sales growth by 6% in the first quarter of 2017. The company has completed 13 separate buyouts in North America since 2013 and is currently positioned well in its industry. Also, Cummins is focused on rewarding shareholders, as the company returned $222 million to shareholders during the first quarter of 2017 via share buybacks and dividends.

Cummins posted a solid EV/EBITDA of 10.94 and an impressive debt/equity ratio of 0.21. Also, the company posted cash flow per share of $11.43, which beats the industry average of $5.70. Basically, Cummins is more efficiently utilizing funds than their close competitors. Finally, Cummins operates in an industry that ranks in the top 9% of the Zacks Industry Rank and a sector that ranks in the top 6% of the Zacks Sector Rank. Cummins inc. currently holds a Zacks Rank #2 (Buy).

5.       Microchip Technology Incorporated MCHP

Microchip Technology develops and manufactures specialized semiconductor products. Currently, Microchip is one of the fastest-growing providers of various microcontrollers in the world. The firm expects to expand its market outside handsets and tablets into the automotive industrial applications industry. Microchip is known for its excellent performance, high quality standards, and reliability, which positions the company well among its competitors.

Microchip Technology aims to reward its shareholders by paying a 1.86% dividend. Further, the company reported a P/E ratio of 16.88 and P/B ratio of 5.02, both of which compare favorably to the industry averages. As of 60 days ago, Microchip’s full-year EPS estimates increased by 8.96% to an impressive $4.62. Microchip Technology holds a Zacks Rank #1 (Strong Buy).

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