NVIDIA & 2 Other Profitable Stocks to Retain in August

Core Insights - Investors should prioritize companies that demonstrate strong profitability after accounting for all expenses, favoring profitable firms over those with losses [1] - NVIDIA Corporation, Broadcom Inc., and ServiceNow, Inc. are identified as top investment picks for the second half of the year due to their high net income ratios [2] Net Income Ratio - The net income ratio is a critical measure of a company's profitability, indicating the percentage of net income relative to total sales revenues, with a higher ratio suggesting effective revenue generation and expense management [3] Screening Parameters - Additional criteria for identifying potential investment winners include: - Zacks Rank of 3 or lower, allowing only 'Strong Buys', 'Buys', and 'Holds' [4] - Trailing 12-month sales and net income growth exceeding industry averages [4] - Trailing 12-month net income ratio higher than industry benchmarks [5] - A strong buy percentage rating greater than 70% [5] - These parameters narrowed the stock universe from over 7,685 to just 11 candidates [5] Company Highlights - NVIDIA Corporation (NVDA): - Provides solutions for graphics, computing, and networking globally - Achieved a 12-month net profit margin of 51.7% and holds a Zacks Rank of 3 [5][7] - Broadcom Inc. (AVGO): - Develops semiconductor devices and infrastructure software solutions worldwide - Reports a 12-month net profit margin of 22.6% and also holds a Zacks Rank of 3 [6][7] - ServiceNow, Inc. (NOW): - Offers cloud-based solutions for digital workflows across various regions - Has a 12-month net profit margin of 13.8% and maintains a Zacks Rank of 3 [8][7]