The Meridian Score

Profitability

How efficiently the company turns revenue into actual profit and returns on the money invested in it — profit margins, return on equity (ROE), return on invested capital (ROIC), and free cash flow, all scored within the sector. High marks mean a business that funds its own growth from profits, holds up better in downturns, and depends less on borrowing or issuing stock. Persistent, high profitability is one of the most reliable signs of a real competitive advantage — a “moat” that keeps rivals from competing the profits away. Quality-focused investors prize this factor because durable profits are what let a company survive bad years and keep compounding through good ones.

Educational information, not investment advice. See it applied across the screener →