Zacks.com featured highlights include Bilibili, Willdan, Sterling, ASML and Leonardo

For Immediate Release

Chicago, IL – April 15, 2025 – Stocks in this week’s article are — like Bilibili BILI , Willdan Group WLDN, Sterling Infrastructure STRL, ASML Holding ASML and Leonardo DRS DRS.

The majority of U.S. stock indices ended last week on a strong note, witnessing a sharp rise on April 11, 2025, as investors’ concerns surrounding the freshly erupted U.S.-China trade war eased somewhat. Producer price data released last Friday, which showed that wholesale inflation fell in March, must have also added to investors’ optimism and was reflected in the form of share price hikes.

This might attract investors to the stock market. However, considering the fact that the global stock market has seen major ups and downs in recent times, a prudent investor knows that to avoid big losses during a crisis, one should choose safe bet stocks like Bilibili, Willdan Group, Sterling Infrastructure, ASML Holding and Leonardo DRS. These stocks bear low leverage and, therefore, should be a safer option for investors if they don’t want to lose big in times of market turmoil.  

Now, before selecting low-leverage stocks, let’s explore what leverage is and how choosing a low-leverage stock helps investors.

What’s the Significance of Low-Leverage Stocks?

In finance, leverage is a term used to denote the practice of borrowing capital by companies to run their operations smoothly and expand the same. Such borrowings are done through debt financing. But there remains an option for equity finance. This is probably due to the cheap and easy availability of debt over equity financing.

However, debt financing has its share of drawbacks. Particularly, it is desirable only as long as it successfully generates a higher rate of return compared to the interest rate. So, to avoid considerable losses in your portfolio, one should always avoid companies that resort to excessive debt financing.

The crux of safe investment lies in choosing a company that is not burdened with debt, as a debt-free stock is almost impossible to find.

The equity market can be volatile at times, and, as an investor, if you don’t want to lose big time, we suggest you invest in stocks that bear low leverage and are, hence, less risky.

To identify such stocks, historically, several leverage ratios have been developed to measure the amount of debt a company bears. The debt-to-equity ratio is one of the most common ratios.

Analyzing Debt/Equity

Debt-to-Equity Ratio = Total Liabilities/Shareholders’ Equity

This metric is a liquidity ratio that indicates the amount of financial risk a company bears. A lower debt-to-equity ratio reflects improved solvency for a company.

With the first-quarter 2025 earnings season knocking on the doors, investors must be eyeing stocks that have exhibited solid earnings growth in the recent past. But if a stock bears a high debt-to-equity ratio in times of economic downturn, its so-called booming earnings picture might turn into a nightmare.

The Winning Strategy

Considering the factors above, it is prudent to choose stocks with a low debt-to-equity ratio to ensure steady returns.

Yet, an investment strategy based solely on the debt-to-equity ratio might not fetch the desired outcome. To choose stocks that have the potential to give you steady returns, we have expanded our screening criteria to include some other factors.

Excluding stocks that have a negative or a zero debt-to-equity ratio, here we present our five picks out of the 12 stocks that made it through the screen.

Bilibili: It provides an online entertainment platform primarily in China. On April 9, 2025, Bilibili published its 2024 Environmental, Social and Governance ("ESG") Report. Per the report, daily active users approached 104 million, each averaging 102 minutes of daily time spent on the platform, in 2024.

The Zacks Consensus Estimate for BILI’s 2025 sales suggests an improvement of 11% from 2024 reported figure. The company boasts a four-quarter average earnings surprise of 2.23%. It currently has a Zacks Rank #2.

Willdan Group: It is a provider of professional technical and consulting services to utilities, private industry and public agencies at all levels of government. On April 3, 2025, Wildan announced that it had been awarded a $30 million energy savings performance contract to expand energy and infrastructure modernization services for the City of Fairfield’s critical facilities. These projects will enhance efficiency, sustainability and operational performance through upgrades, including on-site solar photovoltaic energy generation, electric vehicle charging infrastructure and central plant renovations. 

The Zacks Consensus Estimate for its 2025 earnings suggests a year-over-year improvement of 13.2%. The company delivered an average earnings surprise of 66.13%. It currently sports a Zacks Rank #1.

Sterling Infrastructure:It operates through subsidiaries within segments specializing in E-Infrastructure, Building and Transportation Solutions, principally in the United States, primarily across the Southern, Northeastern, Mid-Atlantic and the Rocky Mountain States, California and Hawaii. On March 20, 2025, Sterling Infrastructure published its 2025 Sustainability Report titled, Building Tomorrow Today. The report highlights Sterling’s ongoing sustainability efforts and Environmental, Social and Governance-related activities and business practices.

The stock boasts a long-term earnings growth rate of 15%. The Zacks Consensus Estimate for its 2025 earnings indicates an improvement of 34.6% from 2024 actuals. It currently sports a Zacks Rank #1.

ASML Holdings: It is a leading manufacturer of advanced technology systems for the semiconductor industry. On March 11, 2025, ASML Holding announced that it has signed a new strategic partnership agreement with imec. The agreement has a duration of five years and aims to develop solutions that advance the semiconductor industry and initiatives focused on sustainable innovation.

ASML boasts a long-term earnings growth rate of 18%. The Zacks Consensus Estimate for its 2025 sales suggests a year-over-year improvement of 14.1%. It currently has a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Leonardo DRS: It develops and manufactures advanced defense products for the U.S. military, intelligence agencies and allies. On March 26, 2025, the company revealed that it had received a prototype project award worth $16.9 million from the U.S. Army to modernize the Paladin Electric Servo Amplifier electric weapon control system for the M109A7 Paladin self-propelled howitzer. 

DRS boasts a long-term earnings growth rate of 14.6%. The Zacks Consensus Estimate for its 2025 sales suggests a year-over-year improvement of 8.4%. It currently sports a Zacks Rank #1.

You can get the rest of the stocks on this list by signing up now for your 2-week free trial to the Research Wizard and start using this screen in your trading. Further, you can also create your strategies and backtest them first before taking the investment plunge.  

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For the rest of this Screen of the Week article please visit Zacks.com at:

https://www.zacks.com/stock/news/2448675/5-low-leverage-stocks-to-add-to-your-portfolio-as-us-inflation-eases?art_rec=home-home-investment_ideas_stocks-ID06-txt-2448675

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Contact: Jim Giaquinto

Company: Zacks.com

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