5 Financial Stocks With A Cautiously High Current Ratio

The following companies in the Financial sector have high current ratios (see below for definition).  Note that this list excludes all companies whose market capitalization is less than $500 million and which are exchange-traded funds (ETFs).

  1. Harbinger Group, Inc. (NYSE:HRG):  The stock has traded in a 52-week range of $4.28 to $6.94 and most recently traded at $6.32 per share.  Its market capitalization is $879 million and it lost $1.16 per share last year.  Its current ratio is 11.02 and its book value per share is $6.44.  About the company: Harbinger Group, Inc. is a holding company.  The Company is a public shell company searching for candidates for acquisition or business combination.
  2. Noah Holdings Limited (NYSE:NOAH):  The stock has traded in a 52-week range of $12.67 to $20.68 per share and most recently traded at $15.93 per share.  Its market capitalization is $886 million and it earned $0.34 per share last year.  Its current ratio is 8.89 and its book valuer per share is $2.48.  About the company: Noah Holdings Ltd. distributes wealth management products in China.  The Company serves high net-worth individuals; enterprises affiliated with high net-worth individuals; and wholesale clients, primarily local commercial banks or branches of national commercial banks which distribute wealth management products to their clients.
  3. Franklin Resources, Inc. (NYSE:BEN):  The shares have traded in a 52-week range of $84 to $130.97 and most recently traded at $128.03 per share.  Its market capitalization is $28.4 billion and it earned $7.69 per share last year.  Its current ratio is 6.87 and its book value per share is $37.92.  About the company:  Franklin Resources, Inc. provides investment advisory services to mutual fund, retirement, institutional/separate accounts and high net worth investors.  The Company manages various asset classes including domestic, international/global and emerging markets equity, domestic, international and municipal fixed income, money funds, alternative investments, and hedge funds.
  4. Acacia Research Corporation (NASDAQ:ACTG):  The shares have traded in a 52-week range of $12.87 to $41.99 and most recently traded at $39.18 per share.  Its market capitalization is $1.6 billion and it earned $0.76 per share last year.  Its current ratio is 10.25 and its book value per share is $7.05.  About the company: Acacia Research, through its subsidiaries, develops, acquires, and licenses patented technologies.  The Company controls patent portfolios covering technologies used in a variety of industries.
  5. SEI Investments Company (NASDAQ:SEIC):  The shares have traded in a 52-week range of $17.35 to $24.88 per share and most recently traded at $23.09 per share.  Its market capitalization is $4.28 billion and it earned $1.22 per share last year.  Its current ratio is 5.62 and its book value per share is $5.82.  About the company: SEI Investments Company provides global investment solutions and business solutions.  The Company integrates technology, research, information services, financial products, and asset management advice to serve banks, mutual fund and pension plan sponsors, insurance companies, money managers, and individual investors.

Looking for dividends: Financial Stocks Paying a Strong Dividend to Investors>>

The current ratio is calculated as current assets over current liabilities.  Current assets are those accounts such as cash, receivables, and other highly liquid assets that can be readily converted to cash.  Current liabilities are generally considered to be those debts due within one fiscal quarter, such as accounts payable, wages, interest payments on long-term debt that are due in the near future, etc.  Therefore, the current ratio is essentially a measure of a company’s ability to pay its bills in the near term.  Companies that are liquid enough to pay their bills can continue operating without trouble.  Accordingly, the higher the current ratio the more likely it is that the company won’t have a problem paying its bills.  Of course, as with all financial ratios, the current ratio can’t be used in isolation to determine whether a stock is a buy or not.

Note: Financial data is taken from Yahoo! Finance.  Selected other data is taken from Google Finance and publicly available SEC filings.  All data are assumed to be accurate.

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