I introduced the subject of Net Profit Margin, NPM, two weeks ago because first quarter earnings reports were quite good, but that wasn’t good enough for many analysts…they were looking for signs of better sales growth. Everyone knows that sales growth is vital to a company’s long-term viability. Increased sales normally lead to rising earnings [...]
Net Profit Margin, NPM, which I introduced last week, shows the after tax profit that a company makes, in percent, for each dollar of sales it receives. It directly relates bottom line and top line performance in one simple figure and, therefore, is a wonderful measure of profitability. Take La-Z-Boy, Inc., LZB, yesterday’s top stock [...]
About 30 years ago, I was in charge of a billion dollar business that was largely involved with a commodity, plastic. We were the world’s leading producer of this plastic, making over two billion pounds a year. In order to cut costs, the business was integrated back to its basic raw materials that came right [...]
