JMF Capstone Wealth ManagementWhat Is The Profitability Premium? – JMF Capstone Wealth Management https://www.jmfcapstone.com An Alabama registered investment advisor Fri, 21 Nov 2025 19:30:19 +0000 en-US hourly 1 https://wordpress.org/?v=5.1.22 What Is The Profitability Premium? https://www.jmfcapstone.com/2016/07/04/what-is-the-profitability-premium/ https://www.jmfcapstone.com/2016/07/04/what-is-the-profitability-premium/#respond Mon, 04 Jul 2016 09:00:43 +0000 http://evolvemypractice.com/?p=2944 Robert Novy-Marx’s 2012 paper, “The Other Side of Value: The Gross Profitability Premium,” not only provided investors with new insights into the cross section of stock returns, it helped explain Warren Buffett’s superior performance—he bought value companies with higher profitability metrics. Key Findings About Profitability Novy-Marx’s study, which covered the period 1962 through 2010, used...

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]]> Robert Novy-Marx’s 2012 paper, “The Other Side of Value: The Gross Profitability Premium,” not only provided investors with new insights into the cross section of stock returns, it helped explain Warren Buffett’s superior performance—he bought value companies with higher profitability metrics.

Key Findings About Profitability

Novy-Marx’s study, which covered the period 1962 through 2010, used accounting data for a given fiscal year starting at the end of June of the following calendar year. Following is a summary of his findings:

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