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+--- Thread: Companies with no debt (/showthread.php?tid=670)
Companies with no debt - earthtodan - 09-13-2014
With all the talk about how interest rates must rise at some point, I thought it would be a good idea to put together a list of companies with no debt. The thesis being,
1) Companies with floating rate debt will experience rising interest obligations
2) Companies selling fixed rate debt to fund buybacks will not experience any direct increase in liabilities, but will find it more expensive to take out new debt to continue buybacks/business as usual
Without further ado, the debt free companies on my watch list are:
NVO
FL
WFM
V
QCOM
PWR (not a dividend payer, but one I'm interested in lately)
I am long most of these companies either by ownership or short put.
I'm aware that leveraging up for cheap can be a good idea in a low interest rate environment, and there's certainly room for debate about whether being debt-free right now is even a good thing. Feel free to discuss the merits or add your ideas to the list.
Dan
RE: Companies with no debt - EricL - 09-13-2014
(09-13-2014, 01:01 PM)earthtodan Wrote: With all the talk about how interest rates must rise at some point, I thought it would be a good idea to put together a list of companies with no debt. The thesis being,
1) Companies with floating rate debt will experience rising interest obligations
2) Companies selling fixed rate debt to fund buybacks will not experience any direct increase in liabilities, but will find it more expensive to take out new debt to continue buybacks/business as usual
Without further ado, the debt free companies on my watch list are:
NVO
FL
WFM
V
QCOM
PWR (not a dividend payer, but one I'm interested in lately)
I am long most of these companies either by ownership or short put.
I'm aware that leveraging up for cheap can be a good idea in a low interest rate environment, and there's certainly room for debate about whether being debt-free right now is even a good thing. Feel free to discuss the merits or add your ideas to the list.
Dan
I love owning companies with no debt, they always seem to be shareholder friendly and can be aggressive in economic downturns because they have the cash to put to work.
Some that I own or have on watch lists that are debt free or close to it include:
Raven Industries (RAVN)
Daktronics (DAKT)
Thor Industries (THO)
Buffalo Wild Wings (BWLD)
Ross Stores (ROST)
Green Mountain Coffee Roasters (GMCR)
Accenture (ACN)
RE: Companies with no debt - earthtodan - 09-13-2014
Nice additions. I'll also add CMG, although it's selling sky high right now.
RE: Companies with no debt - rapidacid - 09-15-2014
Couple more from my portfolio:
ABDNF
RGR
V
CALM
HP
RE: Companies with no debt - Turvok - 09-15-2014
Pretty sure I read GRMN is debt-free as well
RE: Companies with no debt - Dividend Watcher - 09-16-2014
Low debt leaves a lot of room to maneuver during slow or down business cycle. Here are a few I own or like from the CCC list. LT Debt/Equity from the latest quarterly report, 10K or 10Q and some notes:
- Ross Stores (ROST) 7% - LT Debt has stayed the same for the last 5 years while LT Debt/Total Capital has gone down every year for over 5 years running.
- Fastenal (FAST) 0% - have changed dividend schedule a few times in the past, sometimes quarterly and sometimes semi-annual, more sensitive to business cycle since it seems to have higher exposure to smaller businesses.
- FactSet (FDS) 0% - have deferred rent on liabilities but no LT Debt, low yield but great dividend growth rate for over a decade.
- Helmerich & Payne (HP) 1.6% - they do a lot of short term financing using notes and revolving credit facilities paid off from operating cash.
- J&J Snack Foods (JJSF) 0% - the pretzel company, high P/E and low yield, kicking myself for not taking a stake in the Great Recession.
- Lancaster Colony (LANC) 0% - 51 years of dividend growth but low yield.
- Lincoln Electric Holdings (LECO) 0% - welding equipment and consumables, 20 years of dividend growth but low yield.
- Lindsay Corp. (LNN) 0% - struggling with Iraq contract which it has not reserved for if unable to complete. (edited to add 'not' -- pretty material mistake)
(09-15-2014, 04:51 PM)Turvok Wrote: Pretty sure I read GRMN is debt-free as well
Yes but look at the revenues and earnings. Both on a steady down trend. They may stabilize at some point with the recreational, marine and airplane lines but where that will be I don't know.