Old School Businesses that Generate a lot of Cash

HappyHarry said: "Let's think of some of the best money-generating businesses of history. We want to list the industries that offer the best chance to get a high return on cash. I'm partial to many of the Financial Services companies, although they don't always have as high of R.O.I. as I would like."

chahinemm said: "defence and security - ex TASR tech - MSFT - GOOG - SIRI hmmm i know there are a couple more but my brain is not here today :confused: chahine"

HappyHarry said: "Good point about tech. Back in the day CSCO, INTL, MSFT, and SUNW all printed money. But they were susceptible to the bubble in tech and decreased information spending. MSFT still generates a ton of cash though."

sp0om said: "I'd say oil and steel have been pretty huge."

AlfredSokol said: "Oil can be huge. It takes a bunch of money up front though. I think donut making, or chocolate or gum-making are very good long-term cash producers. Also a company like Gilette. Less R&D than a tech company for shavers."

ToastMonger said: "GE. If you ever get a chance to buy GE lower than it usually trades buy it. GE has consistently been a great company for the past billion years. Any of the Big 3 Automakers are considered old school businesses. They are currently losing market share to the Japanese automakers. I don't think that that will happen for long. Things are just weighing out after how long the 3 had an oligopoly. Each of them has something big for the next year that should help sales. Chrysler has the 300 that is selling like crazy recently. The new Ford Mustang is doing quite well and they are about to start production of the convertible. GM has the Chevrolet Cavalier that is doing well."

AlfredSokol said: "One problem with old school businesses: they usually have huge pension obligations, and this can cut into earnings and cash flow big time."

scottigee said: "I bought 3M a while back - that's a big one. Unfortunately it hasn't done well since but it's on the rebound. It splits every once in a while so that's a good thing....I'm thinking if it makes it up to 90 anytime soon it may just split again. It's also good for dividends...not that I have enough money in it to get anything significant. I believe a company like 3M that does business in so many industries with over 3000 active products is good in a recovering economy because there's a much greater chance that portions of the business will take off with whatever it is that grows first. A group in my Buisness Analysis with Financial Statements class just did a report on Sears, which apparently has given $0.92 dividends consistently for years now, and they couldn't find the last time it didn't pay dividends. Price growth is minimal but cash flow from dividends is a nice predictable diversification tool for your portfolio."