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This article will examine 5 large cap stocks to determine their investment potential.

Amgen Inc. (NASDAQ:AMGN)

Amgen Inc. has a market cap of $49.78 billion, with a price to earnings ratio of 11.25. The stock has traded in a 52 week range of between $47.66 and $61.53. The current stock price is $54.08. On July 27th Amgen reported second quarter revenues of $3.96 billion compared to $3.80 billion in revenues in the second quarter of 2010. Second quarter net billion income was $1.17 billion compared to net income of $1.20 billion in the second quarter of 2010. Amgen reported net income of $4.63 for 2010, compared to net income of $4.61 billion in 2009.

Amgen Inc.’s biggest competitor is Johnson & Johnson (NYSE:JNJ) which is currently trading at $54.08. Johnson & Johnson has a price to earnings ratio of 15.08 and has a dividend yield of 3.50%. Johnson & Johnson stock price has risen by 11.6% of over the last 52 weeks, compared to Amgen Inc. that its stock price has risen by 3.84%.

Amgen Inc. has reported remarkably steady revenues and earnings for the last three years. This is a large company that is unlikely to ever have rapid earnings growth. Over the last three years, the stock price has decreased by 16% from $62.85 to $54.08. This is a company that shows little potential for stock appreciation while paying a dividend that yields only 2.10%. I rate Amgen as a hold.

American International Group Inc. (NYSE:AIG)

American International Group has a market cap of $41.79 billion with a price to earnings ratio of 7.66. The stock has been in a 52 week price range of between $21.46 and $62.87. The stock is currently trading at $23.26 which is near its 52 week low. On August 5th, the company reported second quarter revenues of $16.7 billion compared to revenues of $20.0 billion reported in the second quarter of 2010. Second quarter net income was $1.84 billion versus $-266 billion in the second quarter of 2010.

One of AIG’s closest competitors is AXA SA (OTCQX:AXAHY) which is currently trading at $23.26. AXA SA has a market cap of $34.19 billion with a price to earnings ratio of 4.25. Over the last 52 weeks, AXA SA’s stock price is down by 3.45% compared to AIG that its stock price is down by 33.92%. Neither company pays a dividend.

AIG has been “restructuring and rebuilding” since September of 2008. The company has shown some signs that the restructuring process is working. In 2010 net income increased to $7.79 billion from 2009 net income of $-12.2 billion. Second quarter 2011 net income was $1.84 billion up from the first quarter net income of $269 million. Also, the company has done a good job of raising money to repay their government bailout. While AIG has been making significant progress with the restructuring process, they still have substantial future challenges. I would hold off on purchasing this stock. I rate American International Group Inc as a hold.

American Express Company (NYSE:AXP)

American Express Company has a market cap of $57.87 billion with a price to earnings ratio of 12.59. The stock has traded in a 52 week range of between $37.33 and $53.80. The stock is currently trading at $48.48. On July 20th American Express reported second quarter revenues of $8.20 billion, with net income of $1.33 billion. In the second quarter of 2010, the company reported revenues of $7.47 billion with net income of $1.02 billion. Year over Year earnings were up by 90.6% from $2.13 billion in 2009 to $4.06 billion in 2010.

The biggest competitor of American Express is Mastercard Inc. (NYSE:MA), which is trading at $325.33. Mastercard Inc has a price to earnings ratio of 16.14 and last quarter it grew its earnings per share at a rate of 36%. American Express Inc.'s last quarter earnings per share growth was 20%. The stock of both companies have performed well. Over the last 52 weeks, the stock price of Mastercard has gone up by 60.50%, compared to American Express that its stock price has gone up by 18.50%.

American Express has done a admirable job of growing both revenues and net income. The company reports that the number of American Express credit cards that are in use has increased. Also, the amount of money that card users are spending has also increased. If the economy improves, this upward trend should continue. With a price to earnings ratio of 12.59, the stock is relatively cheap. American Express seems to be moving in a positive direction, earnings per share are improving and the stock is relatively cheap. I rate American Express Company as a buy.

Caterpillar Inc. (NYSE:CAT)

Caterpillar Inc. has a market cap of $55.02 billion with a price to earnings ratio of 14.09. The stock has been trading in a 52 week range of between $63.36 and $116.55. The current stock price is $85.16. On July 22nd, the company reported second quarter revenues of $14.2 billion, which was up from the second quarter of 2010 revenues of $10.4 billion. Second quarter net income was $1.01 billion which was up from net income of $707 million in the second quarter of 2010.

Caterpillar Inc.’s closest competitor is Volvo AB (OTCPK:VOLVY) which is trading at $11.56. Volvo AB has a market cap of $23.43 billion with a price to earnings ratio of 9.67.

Caterpillar Inc had some second quarter earnings issues because of its July purchase of Bucyrus International (NASDAQ:BUCY) for $8.6 billion. However in spite of acquisition cost Caterpillar Inc. increased second quarter net income by 42% over the second quarter of 2010. The company expects to realize strong growth in markets like China and India. It should also benefit from improvements in the worldwide economy. I believe that this company will continue to grow both revenues and income and that the stock price will move up. I rate Caterpillar Inc. as a buy.

3M Company (NYSE:MMM)

3M Company has a market cap of $56.77 billion with a price to earnings ratio of 13.58. The stock has been trading in a 52 week range of between $76.50 and $98.19. The stock is currently trading at $80.01. On July 26th, the company reported second quarter revenues of $7.68 billion, compared to the second quarter of 2010 revenues of $6.75 billion. Second quarter net income was $1.16 billion compared to net income of $1.12 billion in the second quarter of 2010.

3M Company has had consistent revenues and income for many years. The company increased revenues by 14% from the second quarter of 2010 to the second quarter of 2011. The company has paid a dividend for 95 straight years and increased its dividend for 53 consecutive years. This is a stock for investors who like to sleep well at night and who are risk adverse. Yet the stock is trading near its 52 week low. Perhaps investors feel that with a dividend yield of 2.8% that their money would be better invested in other low risk higher yielding companies. I agree with that train of thought and rate 3M Company as a hold.

Source: 5 Dividend Stocks Showing You The Money