ROE meanwhile has never dropped below 50%. The operating margin has always exceeded 25% and occasionally topped 40%. Jarvis’s margin and ROE histories are displayed below: I decided to look at the smaller shares in the list and plumped for Jarvis Securities. The 18 matches contained a bevy of other companies I have studied for SharePad, including Rightmove, Games Workshop and Craneware. (You can run this screen for yourself by selecting the “Maynard Paton 25/04/19: Victrex” filter within SharePad’s unbelievable Filter Library. I ran the screen the other day and found 18 matches: I first used the screen to identify Victrex and then shares such as Abcam, Jupiter Fund Management and Dotdigital. To narrow the field down further, the screen also seeks companies that carry net borrowings of less than zero (i.e. This screen applies two ratios favoured by ‘quality’ investors - operating margin and return on equity (ROE).ġ) An operating margin (latest and 10-year average) of 20% or more, and Ģ) An ROE (latest and 10-year average) of 20% or more.Īny business with a margin and ROE consistently above 20% is probably quite special. Today I have returned to one of my favourite SharePad screens.
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