Zacks.com featured highlights include Meta Platforms, Deckers Outdoor, Perion Network and Carlisle

Zacks.com featured highlights include Meta Platforms, Deckers Outdoor, Perion Network and Carlisle

Zacks Equity Research
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For Immediate Release

Chicago, IL – March 12, 2024 – Stocks in this week’s article are Meta Platforms, Inc META, Deckers Outdoor Corp. DECK, Perion Network PERI and Carlisle Companies Inc.CSL.

Add These 4 Top-Ranked Liquid Stocks to Strengthen Your Portfolio

Identifying stocks that offer healthy returns may be tricky for investors. In such a scenario, one may consider liquidity levels, which are a good indicator of a company's financial health.

Liquidity measures a company's ability to meet short-term debt obligations by converting assets into liquid cash and equivalents. These stocks have always been on investors' radar owing to their potential to offer alluring returns.

Nonetheless, one should be careful about investing in a stock with a high liquidity level, as it may also suggest that the company cannot utilize assets effectively. It is advisable to consider a company's efficiency level and liquidity to identify potential winners.

Measures to Identify Liquid Stocks

Current Ratio: It measures current assets relative to current liabilities. The ratio gauges a company's potential to meet short- and long-term debt obligations. A current ratio — the working capital ratio — below 1 indicates that the company has more liabilities than assets. However, a high current ratio does not always suggest that the company is in good financial shape. It may also indicate that the firm failed to utilize its assets significantly. Hence, a range of 1-3 is considered ideal.

Quick Ratio: Unlike the current ratio, the quick ratio — the 'acid-test ratio' or 'quick assets ratio' — indicates a company's ability to pay short-term obligations. It considers inventory, excluding current assets relative to current liabilities. A quick ratio of more than 1 is desirable, like the current ratio.

Cash Ratio: This is the most conservative ratio among the three, considering cash and cash equivalents and invested funds relative to current liabilities. It measures a company's ability to meet existing debt obligations using the most liquid assets. Though a cash ratio of more than 1 may suggest sound financials, a higher number may indicate inefficiency in cash utilization.

A ratio greater than 1 is always desirable but may not always represent a company's financial condition.

Here are four stocks out of the 13 that qualified for the screen:

Meta Platforms, Inc is the world's biggest social media platform. The company is gaining from steady user growth across all regions, particularly Asia Pacific. Increasing engagement on its other platforms, such as Instagram, WhatsApp, Messenger and Facebook, has been a major growth catalyst. META is leveraging AI to recommend Reels content, which is driving traffic on Instagram and Facebook.

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