Some investors believe that Intel (NASDAQ:INTC) stock is cheap because it trades at 11 times its forward price-earnings ratio. Others believe INTC stock isn’t cheap because its earnings growth continues to decelerate. I’m still upbeat about INTC stock, simply because Intel’s free cash flow generation continues to be strong. That’s a much better indicator of value, in my opinion, than earnings or sales.
Intel expects 2019 free cash flow of $15 billion, 4.9% higher than a year earlier, and 27% above its five-year average of $11.8 billion. INTC generated $59 billion of free cash flow over the past five years, returning $55 billion (equaling 93% of its free cash flow) to shareholders in the form of dividends and repurchases of Intel stock. In fiscal 2018, Intel repurchased $10.7 billion of INTC stock at an average price of $49.38 per share. In 2014, it also repurchased more than $10.8 billion of its stock at an average price of $32.47 a share. Based on the stock’s Oct. 14 closing price of $51.64, Intel’s return on investment from these two large buybacks is 32%. Furthermore, INTC has reduced its share count by almost 8% over the past five years. None of this would have been possible without its strong free cash flow.
Source: InvestorPlace
Related Articles:
- 4 Secrets To Finding The Best Dividend Stocks
- What Determines A Dividend Stock's Yield
- 5 Dividend Stocks Yielding Over 3%, With Tiny Payout Ratios
- Warren Buffett's Secret To 50% Returns
- 5 Undervalued, Big-Name Stocks To Consider For Your Dividend Portfolio
Intel’s Free Cash Flow Makes INTC Stock a Buy
Posted by D4L | Saturday, November 09, 2019 | ArticleLinks | 0 comments »________________________________________________________________
Subscribe to:
Post Comments (Atom)
~
Popular Posts Last 30 Days
-
As a relatively new blogger, the one thing that has stood out in my mind is the number of Canadian bloggers in the areas that I am most inte...
-
The quick rise in interest rates over the past year turned investor sentiment toward REITs negative. Higher interest rates make it harder fo...
-
Indeed, with recession on the horizon, investors are increasingly emphasizing quality, safety and dividends in their portfolio selections. W...
-
Ultimately, dividend income and capital appreciation come out of one bucket. So focusing on total return, not just dividend yield, will help...
-
A great year for dividend growth stocks is one in which there are few dividend cuts and fewer companies that failed to raise their dividends...
-
Cash is king when you’re looking to add dividend stocks to your portfolio There’s ample reason for caution. In case you haven’t noticed, a l...
-
Countless people dream of being able to pay their bills with the cash they receive from their investments. But it doesn't have to be jus...
-
There's no time like the present to invest in dividend stocks. Doing so kicks off the process of receiving extra income in the form of d...
-
The Financial Services Sector includes insurance companies, banks, brokerages, mutual funds and other similar companies. Before the 2008-09 ...
-
Linked here is a detailed quantitative analysis of Union Pacific Corporation (UNP). Below are some highlights from the above linked analysis...
0 comments
Post a Comment
Post a Comment
Note: Only a member of this blog may post a comment.