In the second quarter it posted an operating margin of 23% (earnings before interest, taxes and depreciation), up from a miserable 16% in the first quarter.
New Economy stock proponents say to look at sales growth and gross margins instead of earnings growth and profitability.
Specifically, the volatility of net interest margin, the volatility of earnings, and Z score show less risk-taking behavior.
Further increases are expected for the May quarter, with revenues as high as $1.42 billion, a gross margin of 23%, and earnings per share of 8 cents.
"With about $200 million in sales, C-Cube Semiconductor can easily expand its current gross margin of 50% and earnings which are at present in the 65- to 70-cents a share," Veerappan says.
Fannie Mae trades at an estimated 6 times trailing earnings, giving you a margin of safety even if earnings are restated downward.
This business had a fat 33% operating margin (in the sense of earnings before interest, taxes, depreciation and amortization), and its top line goosed by immigrants sending money back home to their families was increasing at a 14% annual clip.
And let's put things in perspective: If Exxon had had the 18% net profit margin of the pharmaceuticals industry, last year's earnings would have been $66.8 billion.
He should have started sooner: GP's operating margins (in the sense of earnings before interest, taxes and depreciation) have fallen to 10% from 16% in 1999.
Last year, worldwide, the EBITDA margin (the earnings out of every dollar of sales) for McDonald's was 35%.
