ZACKS·2025-12-19 14:26Core Insights - The efficiency ratio serves as an indicator of a company's financial health, reflecting how effectively it utilizes its assets and liabilities internally [1] - Companies that have passed the screening process for efficiency ratios include Owlet (OWLT), Proto Labs (PRLB), and Las Vegas Sands (LVS) [1][8] Efficiency Ratios to Consider - Receivables Turnover: This ratio measures a company's ability to extend credit and collect debts, with a higher ratio indicating better performance [2] - Asset Utilization: This ratio assesses how well a company converts its assets into sales, with higher values suggesting greater efficiency [3] - Inventory Turnover: This ratio indicates a company's ability to manage inventory relative to its cost of goods sold, with higher values reflecting better inventory management [4] - Operating Margin: This ratio measures the efficiency of a company in controlling operating expenses, with higher values indicating better expense management [5] Screening Criteria - The screening process utilized efficiency ratios that are above industry averages, narrowing down a universe of over 7,906 stocks to 14 potential candidates [7] - A favorable Zacks Rank of 1 (Strong Buy) was also included in the screening criteria to enhance profitability [6] Top Stocks Identified - Owlet (OWLT): Achieved a positive earnings surprise of 87.8% over the last four quarters, indicating strong performance [9] - Proto Labs (PRLB): Known for its quick-turn custom parts manufacturing, with an average earnings surprise of 18.6% [10] - Las Vegas Sands (LVS): Operates integrated resorts in the U.S. and Asia, with a 14.5% average earnings surprise [11]