Zacks.com featured highlights Inter Parfums, Perion Network, Forestar Group and United Airlines
For Immediate Release
Chicago, IL – January 4, 2023 – Stocks in this week’s article are Inter Parfums IPAR, Perion Network PERI, Forestar Group FOR and United Airlines Holdings UAL.
4 Top-Ranked Liquid Stocks to Strengthen Your Portfolio in 2023
Building a portfolio with stocks that have robust liquidity levels will likely work in favor of investors seeking healthy returns, especially in the current volatile market scenario.
Liquidity measures a company’s capability to meet its short-term debt obligations. Stocks with high liquidity levels have always been in demand, owing to their potential to provide maximum returns.
However, one should be careful about investing in a stock with a high liquidity level. High liquidity may also indicate that the company cannot utilize its assets competently.
Besides having sufficient cash, an investor might also consider a company’s capital deployment abilities before investing in the stock. A healthy company with favorable liquidity may be a profitable pick for one’s portfolio.
Measures to Identify Liquid Stocks
Current Ratio: It measures current assets relative to current liabilities. The ratio gauges a company’s potential to meet short- and long-term debt obligations. A current ratio — also known as the working capital ratio — below 1 indicates that the company has more liabilities than assets. However, a high current ratio does not always suggest that the company is in good financial shape. It may also suggest that the firm failed to utilize its assets significantly. Hence, a range of 1-3 is considered ideal.
Quick Ratio: Unlike the current ratio, the quick ratio — also called the ‘acid-test ratio’ or the ‘quick assets ratio’ — indicates a company’s ability to pay short-term obligations. It considers inventory, excluding the current assets relative to current liabilities. Like the current ratio, a quick ratio of more than 1 is desirable.
Cash Ratio: This is the most conservative ratio among the three, considering cash and cash equivalents and invested funds relative to current liabilities. It measures a company’s ability to meet current debt obligations using the most liquid assets. Though a cash ratio of more than 1 may suggest sound financials, a higher number may indicate inefficiency in cash utilization.
A ratio greater than 1 is always desirable but may not always represent a company’s financial condition.
Here are four of the 10 stocks that qualified for the screen:
Inter Parfums manufactures, distributes and markets a wide array of fragrances and related products. Inter Parfums continues to see solid momentum in its travel retail business. Considering the solid year-to-date performance and robust projections for the rest of the year, management raised its 2022 view during third-quarter earnings release. Management also expects growth in 2023, likely driven by a solid brand portfolio and global distribution network.
The company is working to expand its business through new licenses or buyouts. The Zacks Consensus Estimate for 2022 bottom line is pegged at $3.40 per share, up 4.3% in the past 60 days. IPAR has a Growth Score of A and a trailing four-quarter earnings surprise of 27.8%, on average.
Perion Network is an Israel-based technology company that offers brands and publishers online advertising and search monetization solutions. The company is committed to providing data-driven execution, from high-impact ad formats to branded search and a unified social and mobile programmatic platform. The Zacks Consensus Estimate for its 2022 earnings is pegged at $2.20 per share, up 7.3% in the past 60 days. The company has a Growth Score of A and a trailing four-quarter earnings surprise of 27.8%, on average.
Forestar Group is a residential lot development company and a major subsidiary of. D.R. Horton. The company’s fourth-quarter fiscal 2022 revenues amounted to $381.4 million on 3,914 lots sold. In fiscal 2022, FOR delivered more than 17,600 residential lots. The Zacks Consensus Estimate for fiscal 2023 earnings is pegged at $2.77 per share, up 6.1% in the past 60 days. FOR has a Growth Score of B and a trailing four-quarter earnings surprise of 50.2%, on average.
United Airlines Holdings operates flight services across North America and also destinations in Asia, Europe, the Middle East and Latin America. Owing to buoyant air-travel demand, United Airlines posted a significant year-over-year increase (about 75%) in third-quarter 2022 passenger revenues. Management believes air-travel demand and pricing trends will also remain strong in the December 2022 quarter.
UAL expects the adjusted operating margin in the December quarter to be around 10%, rising above the 2019 levels (pre-coronavirus) for the first time. Driven by solid demand, management expects total revenue per available seat mile (TRASM) to increase in the 24%-25% band in the December quarter from fourth-quarter 2019 actuals.
The Zacks Consensus Estimate for 2022 bottom line is pegged at $2.18 per share, up 15.3% in the past 60 days. UAL has a Growth Score of A and a trailing four-quarter earnings surprise of 7.8%, on average.
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For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/2034488/4-top-ranked-liquid-stocks-to-strengthen-portfolio-in-2023
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United Airlines Holdings Inc (UAL) : Free Stock Analysis Report
Forestar Group Inc (FOR) : Free Stock Analysis Report
Inter Parfums, Inc. (IPAR) : Free Stock Analysis Report
Perion Network Ltd (PERI) : Free Stock Analysis Report
