Look for Companies That Have Cash
Sep 26th, 2008 | By Charles Delvalle | Category: Stock Market Investing“In a market like this, you need to look for companies that have cash,” says Charles Delvalle in Investor’s Daily Edge. Basically, what you’re looking for is a company with more cash than debt.
When a company has a lot of cash, they avoid most of the financing problems that debt-heavy corporations are facing. Plus, with cash on hand a company is able to support their shares by issuing big buybacks, increasing the size of their dividend, or both.
Also, if the economy goes slow, cash-rich corporations are better able to weather the storm, since they have money left in reserves.
Over the next year, you should start seeing cash-rich corporations lead the stock market, while debt-heavy companies are left in the dust.
The easiest way to see how much cash a company has is to go to Yahoo Finance. Enter the ticker symbol of the company you are looking at, hit enter, and then look to your left hand side for “Key Statistics” Once there, just scroll down and you’ll see how much cash and debt a given company has.
What you want is a company with more cash than debt.
Source: It’s All About Cash
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Charles Delvalle is a self-taught market-timing professional and value analyst who uses a combination of technical indicators and fundamental research to achieve consistent gains on stocks, commodities and options.
Charles is also a staunch contrarian and takes pride in finding undervalued sectors and discovering great companies on the cheap. He questions government reports and the status quo. In addition to swing trading options, Charles is also Co-Editor of the monthly advisory service - INCOME.
