Service is characterized by hard work and low margins, but there are some companies with wonderful business models that generate double-digit margins within the service sector — I think about McDonald's or Starbucks. They created a huge shareholder value due to the global expansion of the brand and realized big economies of scale.
I screened the service sector by stocks with an operating margin and return on investment over 15 percent, a dividend yield over two percent and finally a market capitalization over USD300 million. Thirteen companies fulfilled these criteria of which four are high yields and six are recommended to buy or better.
Here are my favorite stocks:
1. McDonald's Corporation (MCD, Financial) has a market capitalization of $98.64 billion. The company employs 420,000 people, generates revenues of $27,006.00 million and has a net income of $5,503.10 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $9,766.70 million. Because of these figures, the EBITDA margin is 36.16 percent (operating margin 31.58 percent and the net profit margin finally 20.38 percent).
The total debt representing 37.89 percent of the company’s assets and the total debt in relation to the equity amounts to 86.87 percent. Due to the financial situation, a return on equity of 37.92 percent was realized. Twelve trailing months earnings per share reached a value of $5.27. Last fiscal year, the company paid $2.53 in form of dividends to shareholders.
Here are the price ratios of the company: The P/E ratio is 18.37, P/S ratio 3.65 and P/B ratio 6.87. Dividend Yield: 2.89 percent. The beta ratio is 0.44.
2. Guess? (GES, Financial) has a market capitalization of $3.33 billion. The company employs 15,000 people, generates revenues of $2,487.29 million and has a net income of $294.50 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $472.12 million. Because of these figures, the EBITDA margin is 18.98 percent (operating margin 16.27 percent and the net profit margin finally 11.84 percent).
The total debt representing 0.85 percent of the company’s assets and the total debt in relation to the equity amounts to 1.36 percent. Due to the financial situation, a return on equity of 27.63 percent was realized. Twelve trailing months earnings per share reached a value of $2.94. Last fiscal year, the company paid $0.68 in form of dividends to shareholders.
Here are the price ratios of the company: The P/E ratio is 12.24, P/S ratio 1.34 and P/B ratio 3.14. Dividend Yield: 2.23 percent. The beta ratio is 1.66.
3. The McGraw-Hill Companies (MHP) has a market capitalization of $12.95 billion. The company employs 22,700 people, generates revenues of $6,246.00 million and has a net income of $858.00 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $1,807.00 million. Because of these figures, the EBITDA margin is 28.93 percent (operating margin 22.77 percent and the net profit margin finally 13.74 percent).
The total debt representing 18.64 percent of the company’s assets and the total debt in relation to the equity amounts to 79.44 percent. Due to the financial situation, a return on equity of 44.90 percent was realized. Twelve trailing months earnings per share reached a value of $2.75. Last fiscal year, the company paid $1.00 in form of dividends to shareholders.
Here are the price ratios of the company: The P/E ratio is 16.96, P/S ratio 2.07 and P/B ratio 8.53. Dividend Yield: 2.19 percent. The beta ratio is 1.06.
Take a closer look at the full table of high profitable services stocks with best dividends. The average price to earnings ratio (P/E ratio) amounts to 15.09 and forward P/E ratio is 12.96. The dividend yield has a value of 4.17 percent. Price to book ratio is 8.33 and price to sales ratio 2.57. The operating margin amounts to 29.22 percent. Finally, the return on equity has a fantastic margin of 56.15 percent and the return on investment follows with a value of 26.80 percent.
Related stock ticker symbols:
ITRN, GA, NCMI, HRB, ENL, STRA, PAYX, RUK, MCD, IHG, WU, GES, MHP
Selected Articles:
· Services Stocks With Strongest Earnings Forecasts And Good Dividends
· 11 Service Dividend Stocks With Buy Or Better Rating
· Best Services Stock Picks For 2012
· 11 Low Volatility Stocks From Services Sector With Goods Dividends
I screened the service sector by stocks with an operating margin and return on investment over 15 percent, a dividend yield over two percent and finally a market capitalization over USD300 million. Thirteen companies fulfilled these criteria of which four are high yields and six are recommended to buy or better.
Here are my favorite stocks:
1. McDonald's Corporation (MCD, Financial) has a market capitalization of $98.64 billion. The company employs 420,000 people, generates revenues of $27,006.00 million and has a net income of $5,503.10 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $9,766.70 million. Because of these figures, the EBITDA margin is 36.16 percent (operating margin 31.58 percent and the net profit margin finally 20.38 percent).
The total debt representing 37.89 percent of the company’s assets and the total debt in relation to the equity amounts to 86.87 percent. Due to the financial situation, a return on equity of 37.92 percent was realized. Twelve trailing months earnings per share reached a value of $5.27. Last fiscal year, the company paid $2.53 in form of dividends to shareholders.
Here are the price ratios of the company: The P/E ratio is 18.37, P/S ratio 3.65 and P/B ratio 6.87. Dividend Yield: 2.89 percent. The beta ratio is 0.44.
2. Guess? (GES, Financial) has a market capitalization of $3.33 billion. The company employs 15,000 people, generates revenues of $2,487.29 million and has a net income of $294.50 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $472.12 million. Because of these figures, the EBITDA margin is 18.98 percent (operating margin 16.27 percent and the net profit margin finally 11.84 percent).
The total debt representing 0.85 percent of the company’s assets and the total debt in relation to the equity amounts to 1.36 percent. Due to the financial situation, a return on equity of 27.63 percent was realized. Twelve trailing months earnings per share reached a value of $2.94. Last fiscal year, the company paid $0.68 in form of dividends to shareholders.
Here are the price ratios of the company: The P/E ratio is 12.24, P/S ratio 1.34 and P/B ratio 3.14. Dividend Yield: 2.23 percent. The beta ratio is 1.66.
3. The McGraw-Hill Companies (MHP) has a market capitalization of $12.95 billion. The company employs 22,700 people, generates revenues of $6,246.00 million and has a net income of $858.00 million. The firm’s earnings before interest, taxes, depreciation and amortization (EBITDA) amounts to $1,807.00 million. Because of these figures, the EBITDA margin is 28.93 percent (operating margin 22.77 percent and the net profit margin finally 13.74 percent).
The total debt representing 18.64 percent of the company’s assets and the total debt in relation to the equity amounts to 79.44 percent. Due to the financial situation, a return on equity of 44.90 percent was realized. Twelve trailing months earnings per share reached a value of $2.75. Last fiscal year, the company paid $1.00 in form of dividends to shareholders.
Here are the price ratios of the company: The P/E ratio is 16.96, P/S ratio 2.07 and P/B ratio 8.53. Dividend Yield: 2.19 percent. The beta ratio is 1.06.
Take a closer look at the full table of high profitable services stocks with best dividends. The average price to earnings ratio (P/E ratio) amounts to 15.09 and forward P/E ratio is 12.96. The dividend yield has a value of 4.17 percent. Price to book ratio is 8.33 and price to sales ratio 2.57. The operating margin amounts to 29.22 percent. Finally, the return on equity has a fantastic margin of 56.15 percent and the return on investment follows with a value of 26.80 percent.
Related stock ticker symbols:
ITRN, GA, NCMI, HRB, ENL, STRA, PAYX, RUK, MCD, IHG, WU, GES, MHP
Selected Articles:
· Services Stocks With Strongest Earnings Forecasts And Good Dividends
· 11 Service Dividend Stocks With Buy Or Better Rating
· Best Services Stock Picks For 2012
· 11 Low Volatility Stocks From Services Sector With Goods Dividends
