American Electric Power Company is a large utility company that pays a healthy dividend, but like many other companies we’ve reviewed recently, its debt is too large to pass the requirements of either a Defensive Investor or an Enterprising Investor.
The Walt Disney Company is another stalwart of the American business world. The company has fairly strong financials and has a very strong history of earnings growth. Unfortunately, Defensive Investors and Enterprising Investors following the approaches set forth in Benjamin Graham’s The Intelligent Investor set very stringent requirements for the companies in which they invest, and Disney does not pass those requirements.
Walmart Stores is a solid company with a strong history of success; however, when measured using ModernGraham’s requirements for the Defensive Investor or the Enterprising Investor, revised and updated from Benjamin Graham’s The Intelligent Investor, the company does not appear to be a solid opportunity at this time.
We looked at 10 different companies this week, each of which is a component of the Dow Jones Industrial Average. Here’s a summary of the ModernGraham Valuations.
United Technologies Corp. has had very stable earnings growth and in many respects is a very intriguing company, but it seems the market is overvaluing it at this time. In the preliminary assessment, the company does not have a very strong current ratio and is trading at a high PB ratio. These facts combined eliminate the company from contention for Defensive Investors and Enterprising Investors, and places it in our Speculative realm. From a valuation standpoint, the market is implying a growth rate that simply has not been accomplished by United Technologies Corp.
Company ProfileÂ (obtained fromÂ Google Finance):Â Merck & Co., Inc. (Merck) is a global health care company that delivers health solutions through its prescription medicines, vaccines, biologic therapies, animal health, and consumer care products, which it markets directly and through its joint ventures. The Company consists of four operating segments, which are the Pharmaceutical, Animal Health, Consumer Care […]
Company ProfileÂ (obtained fromÂ Google Finance):Â McDonaldâ€™s Corporation franchises and operates McDonaldâ€™s restaurants in the global restaurant industry. These restaurants serve menu at various price points providing value in 119 countries globally. All restaurants are operated either by the Company or by franchisees, including conventional franchisees under franchise arrangements, and developmental licensees and foreign affiliated markets under license […]
Company ProfileÂ (obtained fromÂ Google Finance):Â International Business Machines Corporation (IBM) is an information technology (IT) company. IBM operates in five segments: Global Technology Services (GTS), Global Business Services (GBS), Software, Systems and Technology and Global Financing. GTS primarily provides IT infrastructure services and business process services. GBS provides professional services and application management services. Software consists primarily […]
Company ProfileÂ (obtained fromÂ Google Finance):Â The Home Depot, Inc. (The Home Depot) is a home improvement retailer. The Company operates The Home Depot stores, which are full-service, warehouse-style stores. The Home Depot stores sell an assortment of building materials, home improvement and lawn and garden products and provide a number of services. The Home Depot stores average […]