Ask the Fool: Beware of too many 'one-time' charges
Q: Are companies with low profit margins bad investments? โ C.R., Vineland, Colo. A: Not necessarily. Fat profit margins are generally preferable, as they often reflect competitive advantages (such as a strong brand that commands a higher price). Still, you neednt avoid lower-margin businesses. Instead, look at the whole picture. Imagine, for example, that the Laverne Brewery Inc. (ticker: DEFAZ) has a whopping net profit margin of 25%, while Shirley Beer Co. (ticker: FEENY) has just a 2% mar...
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