Accounting, tax preparation, bookkeeping and payroll services topped the list of most profitable industries over the past 12 months, according to the financial information company Sageworks.

The ranking was based on pre-tax profit margins for privately held companies. This past year, accounting-related services (including accounting, tax preparation, bookkeeping and payroll service companies) held the highest ranking, with net profits amounting to 18.4 percent of sales, on average for the 12 months ended June 30, 2017.

In second place was real-estate leasing companies, with a 17.9 percent net profit margin, followed closely by legal services, in third place with profitability of 17.4 percent. All three industries placed well above the average for U.S. private companies, which had an average net profit margin of 8.9 percent.

Pre-tax net profit margins aren’t necessarily the most pertinent measures for many businesses, Sageworks pointed out. “Not all private companies are necessarily shooting for high profitability; maybe their industry is price sensitive and rely on volume for growth (like grocery stores) or maybe they are sinking profits back into the business for R&D (growth companies),” said Sageworks analyst Libby Bierman in a statement. “But in most instances, higher profitability is better, and the industries atop this list are getting more from their business investment than others.”

Sageworks most profitable industries
Net Profit Margin
Industry Code
18.4%
5412 - Accounting, Tax Preparation, Bookkeeping, and Payroll Services
17.9%
5311 - Lessors of Real Estate
17.4%
5411 - Legal Services
16.0%
5511 - Management of Companies and Enterprises
14.9%
5313 - Activities Related to Real Estate
14.8%
6212 - Offices of Dentists
14.3%
5312 - Offices of Real Estate Agents and Brokers
13.2%
2123 - Nonmetallic Mineral Mining and Quarrying
13.0%
6213 - Offices of Other Health Practitioners
12.4%
8131 - Religious Organizations
12.1%
6215 - Medical and Diagnostic Laboratories
12.1%
2372 - Land Subdivision
12.0%
5321 - Automotive Equipment Rental and Leasing
11.0%
4931 - Warehousing and Storage
10.8%
8122 - Death Care Services
10.6%
5419 - Other Professional, Scientific, and Technical Services
10.3%
5416 - Management, Scientific, and Technical Consulting Services
10.2%
5414 - Specialized Design Services
9.8%
6116 - Other Schools and Instruction
9.7%
4884 - Support Activities for Road Transportation

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