Profitability Analysis of Top Five Services Sector Heavyweights – WMT, V, AMZN, CMCSA, HD

Profitability ratios are a set of financial metrics that are used to assess a firm’s ability to produce earnings as evaluated against its outlays and other relevant expenses incurred during a specific period of time.

For most of profitability ratios, having a superior value relative to a rival’s ratio or the similar ratio from an earlier quarter is indicative that the firm is doing well.

Few examples of profitability ratios are profit margin, return on assets (ROA) and return on equity (ROE). It is vital to note that a little bit of background knowledge is essential in order to make relevant evaluation when analyzing these ratios. In this article we will discuss profitability ratios of top five services sector stocks with higher average market volume.

Wal-Mart Stores, Inc (NYSE:WMT) offered net profit margin of 3.73% and return on equity ratio of 23.52%. The world’s biggest retail store chain has return on assets ratio of 8.64%. The Bentonville, Arkansas based company has the market capitalization of 231.52 billion while its P/E ratio of 14.24. Institutional ownership of the security was 31% while its 3.35 billion shares were outstanding.

Visa Inc (NYSE:V) has market capitalization of 106.56 billion and offered 5.73% return on assets. The financial services company has institutional ownership of 84.08% and its price to earnings ratio was 85.67. PEG ratio, which measures growth also, was 4.57. Net profit margin of the company was 20.55% while gross profit margin was 82.24%.

Amazon.com, Inc (NASDAQ:AMZN) has market capitalization of 131.81 billion while its Price to earnings ratio was 3594.36. The world’s biggest online retail store company offered earning per share of 0.07 and its 452.96 million shares were outstanding while the 68% stock of the company was held by institutional investors. The company has return on equity ratio of 0.52 while ROA was 0.76%. Net profit margin of the company was 0.28%.

In the profitability analysis of Comcast Corporation (NASDAQ:CMCSA), return on equity ratio was recorded as 12.50% while its return on investment ratio was 6.01%. The company offered 4.79% as return on assets. The company has market capitalization of $104.11 billion while its EPS was 2.19. Net profit margin was 12.39% while gross profit margin was 31.81%.

The Home Depot, Inc (NYSE:HD) has market capitalization of 95.48 billion while its Price to earnings ratio was 22.60. The company has return on equity ratio of 24.15 while ROA was 10.31%. Net profit margin of the company was 5.91% while its gross profit margin was 34.57%. Shares of the company was moving ahead of SMA 50 with 1.63% and head off SMA 200 with 14.37%.

Disclosure: Opinions expressed in this article are those of the authors alone who have no stake in any stocks mentioned, and did not plan to acquire any stake within the next 72 hours.