The Cheapest Stocks on the Dow: Intel
The following video is part of our "Motley Fool Conversations" series, in which industrials editor/analyst Isaac Pino discusses topics from across the investing world.
In today's edition, Isaac takes a cue from Fool colleague Dan Dzombak, who recently described a time-tested tool for uncovering companies with above average cash flows. Sometimes a simple metric like return on equity or return on assets can be misconstrued due to legal accounting manipulations, but evaluating a company based on cash generated from invested capital helps minimize any management-driven manipulations. Isaac applies this method to the Dow companies to identify the cheapest components and finds Intel near the top. Intel leads the pack when it comes to microprocessors, capturing over 80% of the market share according to Morningstar research. However, competitor ARM Holdings poses a significant threat as consumers flock towards mobile devices, 95% of which are powered by ARM Holdings' chips. Investors have witnessed challengers to Intel in the past, including AMD, but Intel seems to keep them at bay with its incredibly wide economic moat.
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The article The Cheapest Stocks on the Dow: Intel originally appeared on Fool.com.Isaac Pinohas no positions in the stocks mentioned above. The Motley Fool owns shares of Berkshire Hathaway and Intel.Motley Fool newsletter services recommendIntel. Try any of our Foolish newsletter servicesfree for 30 days. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.