Seeking Alpha
Value, growth, long-term horizon, medium-term horizon
Profile| Send Message| ()  

Do you consider sales trends when evaluating a company's stock? One idea is to compare trends in revenue to trends in accounts receivable.

To illustrate this, we ran a screen on the tech sector for large-cap stocks, with market caps above $10 billion. We then screened for those with encouraging sales trends, as indicated by faster growth in revenue than accounts receivable year-over-year, as well as receivables comprising a smaller portion of current assets over the same time period.

Accounts receivable represents the portion of revenue not yet received, so the smaller the portion of revenue the better.

Interactive Chart: Press Play to compare changes in market cap over the last two years for the top six 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 have strong sales trends? Use this list as a starting point for your own analysis.

1. Agilent Technologies Inc. (A): Provides bio-analytical and electronic measurement solutions to the communications, electronics, life sciences, and chemical analysis industries in the United States and internationally. Market cap at $15.88B. Revenue grew by 7.64% during the most recent quarter ($1,635M vs. $1,519M y/y). Accounts receivable grew by -4.68% during the same time period ($814M vs. $854M y/y). Receivables, as a percentage of current assets, decreased from 18.57% to 14.24% during the most recent quarter (comparing 3 months ending 2012-01-31 to 3 months ending 2011-01-31).

2. Accenture plc (ACN): Operates as a management consulting, technology services, and outsourcing company. Market cap at $46.27B. Revenue grew by 11.75% during the most recent quarter ($7,259.83M vs. $6,496.29M y/y). Accounts receivable grew by 7.41% during the same time period ($4,774.76M vs. $4,445.48M y/y). Receivables, as a percentage of current assets, decreased from 43.25% to 41.32% during the most recent quarter (comparing 3 months ending 2012-02-29 to 3 months ending 2011-02-28).

3. Adobe Systems Inc. (ADBE): Operates as a diversified software company in the Americas, Europe, the Middle East, Africa, and Asia. Market cap at $17.18B. Revenue grew by 1.7% during the most recent quarter ($1,045.22M vs. $1,027.71M y/y). Accounts receivable grew by -3.96% during the same time period ($512.21M vs. $533.35M y/y). Receivables, as a percentage of current assets, decreased from 15.92% to 14.61% during the most recent quarter (comparing 13 weeks ending 2012-03-02 to 13 weeks ending 2011-03-04).

4. ARM Holdings plc (ARMH): Designs microprocessors, physical IP, and related technology and software, as well as sells development tools to enhance the performance of high-volume embedded applications. Market cap at $13.13B. Revenue grew by 20.93% during the most recent quarter ($137.8M vs. $113.95M y/y). Accounts receivable grew by 13.21% during the same time period ($119.63M vs. $105.67M y/y). Receivables, as a percentage of current assets, decreased from 25.86% to 23.64% during the most recent quarter (comparing 3 months ending 2011-12-31 to 3 months ending 2010-12-31).

5. Cerner Corporation (CERN): Designs, develops, markets, installs, hosts, and supports healthcare information technology, healthcare devices, and content solutions for healthcare organizations and consumers worldwide. Market cap at $12.92B. Revenue grew by 23.08% during the most recent quarter ($615.63M vs. $500.2M y/y). Accounts receivable grew by 18.1% during the same time period ($563.21M vs. $476.9M y/y). Receivables, as a percentage of current assets, decreased from 41.61% to 37.49% during the most recent quarter (comparing 13 weeks ending 2011-12-31 to 13 weeks ending 2011-01-01).

6. CenturyLink, Inc. (CTL): Operates as an integrated communications company. Market cap at $24.24B. Revenue grew by 170.21% during the most recent quarter ($4,653M vs. $1,722M y/y). Accounts receivable grew by 142.82% during the same time period ($1,979M vs. $815M y/y). Receivables, as a percentage of current assets, decreased from 71.3% to 56.17% during the most recent quarter (comparing 3 months ending 2011-12-31 to 3 months ending 2010-12-31).

7. Dell Inc. (DELL): Provides integrated technology solutions in the information technology industry worldwide. Market cap at $29.36B. Revenue grew by 2.16% during the most recent quarter ($16,031M vs. $15,692M y/y). Accounts receivable grew by -3.29% during the same time period ($9,803M vs. $10,136M y/y). Receivables, as a percentage of current assets, decreased from 34.93% to 33.29% during the most recent quarter (comparing 13 weeks ending 2012-02-03 to 13 weeks ending 2011-01-28).

8. LinkedIn Corporation Class A Co (LNKD): Operates an online professional network. Market cap at $10.58B. Revenue grew by 105.31% during the most recent quarter ($167.74M vs. $81.7M y/y). Accounts receivable grew by 91.16% during the same time period ($111.37M vs. $58.26M y/y). Receivables, as a percentage of current assets, decreased from 33.83% to 15.34% during the most recent quarter (comparing 3 months ending 2011-12-31 to 3 months ending 2010-12-31).

9. AT&T, Inc. (T): Provides telecommunication services to consumers, businesses, and other service providers worldwide. Market cap at $187.59B. Revenue grew by 3.64% during the most recent quarter ($32,503M vs. $31,361M y/y). Accounts receivable grew by -0.03% during the same time period ($13,606M vs. $13,610M y/y). Receivables, as a percentage of current assets, decreased from 65.26% to 59.09% during the most recent quarter (comparing 3 months ending 2011-12-31 to 3 months ending 2010-12-31).

10. Tyco Electronics, Ltd. (TEL): Provides engineered electronic components, network solutions, specialty products, and subsea telecommunication systems. Market cap at $15.71B. Revenue grew by 3.41% during the most recent quarter ($3,309M vs. $3,200M y/y). Accounts receivable grew by -7.43% during the same time period ($2,241M vs. $2,421M y/y). Receivables, as a percentage of current assets, decreased from 35.67% to 34.07% during the most recent quarter (comparing 13 weeks ending 2011-12-30 to 13 weeks ending 2010-12-24).

11. Verizon Communications Inc. (VZ): Provides communication services. Market cap at $109.62B. Revenue grew by 7.73% during the most recent quarter ($28,436M vs. $26,395M y/y). Accounts receivable grew by -0.04% during the same time period ($11,776M vs. $11,781M y/y). Receivables, as a percentage of current assets, decreased from 52.72% to 38.06% during the most recent quarter (comparing 3 months ending 2011-12-31 to 3 months ending 2010-12-31).

*Accounting data sourced from Google Finance, all other data sourced from Finviz.

Source: 11 Large-Cap Tech Stocks With Encouraging Sales and Accounts Receivable Trends