5 High Cash Tech Stocks With Impressive Profitability

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 |  Includes: AAPL, CAJ, CSCO, INTC, TSM
by: Kapitall

Companies holding large amounts of cash are in a position to make significant investments in their operations, which can bode well for future profitability.

We ran a screen on stocks from the tech sector for those with high amounts of cash, with most recent quarter cash and equivalents above $5 billion. We then screened these stocks for those with high profitability, beating their industry peers on gross, operating, and pretax margins.

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.‬

We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 index over the last month. To access a complete analysis of this list's recent performance, click here.

Do you think these companies will use their cash wisely? Use this list as a starting-off point for your own analysis.

List sorted by MRQ cash and equivalents.

1. Cisco Systems, Inc. (NASDAQ:CSCO): Designs, manufactures, and sells Internet protocol (NYSE:IP)-based networking and other products related to the communications and information technology industry worldwide. Market cap of $84.04B. MRQ cash and equivalents at $44.59B. TTM gross margin at 66.24% vs. industry gross margin at 59.89%. TTM operating margin at 19.92% vs. industry operating margin at 16.47%. TTM pretax margin at 18.11% vs. industry pretax margin at 17.83%. The stock has lost 25.21% over the last year.

2. Apple Inc. (NASDAQ:AAPL): Designs, manufactures, and markets personal computers, mobile communication and media devices, and portable digital music players, as well as sells related software, services, peripherals, networking solutions, and third-party digital content and applications worldwide. Market cap of $352.05B. MRQ cash and equivalents at $28.40B. TTM gross margin at 41.42% vs. industry gross margin at 41.23%. TTM operating margin at 30.43% vs. industry operating margin at 23.54%. TTM pretax margin at 30.78% vs. industry pretax margin at 23.52%. Might be undervalued at current levels, with a PEG ratio at 0.72, and P/FCF ratio at 12.1. The stock has gained 47.29% over the last year.

3. Canon Inc. (NYSE:CAJ): Manufactures and sells network digital multifunction devices (MFDs), plain paper copying machines, laser printers, inkjet printers, cameras, and lithography equipments primarily under Canon brand in the Americas, Europe, Asia and Oceania. Market cap of $60.10B. MRQ cash and equivalents at $12.04B. TTM gross margin at 55.85% vs. industry gross margin at 52.23%. TTM operating margin at 9.59% vs. industry operating margin at 9.16%. TTM pretax margin at 9.78% vs. industry pretax margin at 8.77%. Offers a good dividend, and appears to have good liquidity to back it up--dividend yield at 3.44%, current ratio at 2.39, and quick ratio at 1.86. The stock has gained 6.78% over the last year.

4. Intel Corporation (NASDAQ:INTC): Engages in the design, manufacture, and sale of integrated circuits for computing and communications industries worldwide. Market cap of $102.60B. MRQ cash and equivalents at $11.55B. TTM gross margin at 74.42% vs. industry gross margin at 60.90%. TTM operating margin at 34.39% vs. industry operating margin at 26.79%. TTM pretax margin at 34.43% vs. industry pretax margin at 26.71%. Offers a good dividend, and appears to have good liquidity to back it up--dividend yield at 4.3%, current ratio at 2.23, and quick ratio at 1.84. The stock has gained 11.53% over the last year.

5. Taiwan Semiconductor Manufacturing Co. Ltd. (NYSE:TSM): Engages in the computer-aided designing, manufacturing, packaging, testing, and selling integrated circuits and other semiconductor devices; and manufacturing masks. Market cap of $59.71B. MRQ cash and equivalents at $5.48B. TTM gross margin at 70.95% vs. industry gross margin at 60.86%. TTM operating margin at 36.91% vs. industry operating margin at 26.85%. TTM pretax margin at 39.22% vs. industry pretax margin at 26.76%. It's been a rough couple of days for the stock, losing 5.03% over the last week.

*Cash data sourced from Screener.co, profitability data sourced from Fidelity, all other data sourced from Finviz.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.