Loss to Profit — US Turnaround Stocks with Quarterly Earnings Comeback

About This Screen

Turnaround investing is one of the highest-conviction, highest-risk strategies in equity markets. When a company transitions from reporting quarterly losses to quarterly profits, it often represents a genuine inflection point — a moment when the market begins to reassess a previously beaten-down stock. The challenge is separating sustainable business recoveries from temporary accounting or seasonal effects. This screen does the initial heavy lifting by filtering for the most recent quarter-over-quarter swing from red to black.

The Loss to Profit screen compares every company's most recent two reported quarters. The previous quarter (Q-1) must show a negative net income — i.e., the company reported a loss. The most recent quarter (Q0) must show a positive net income — i.e., the company is now profitable. Both conditions must be satisfied simultaneously. Companies that were loss-making in both quarters, or profitable in both, do not appear. Only genuine loss-to-profit reversals make the cut.

Not every loss-to-profit reversal is investment-grade. Some reversals are driven by one-time asset sales, tax credits, or litigation settlements rather than underlying operational improvement. When reviewing names from this screen, look at the operating profit trend (not just net profit), the revenue trajectory, and whether management has guided for continued profitability. A company that turned profitable purely because of a one-off item is not a turnaround — it is a statistical artefact.

The most compelling names on this screen are those where the swing to profitability is accompanied by revenue growth, gross margin expansion, and a meaningful reduction in operating expenses. These are signs of genuine business healing rather than financial engineering. Turnarounds that are also growing their top line have the additional tailwind of operating leverage — as fixed costs get spread over rising revenues, profitability can expand rapidly. This screen is updated every day to capture the latest quarterly filings as they hit our database.