Visa and Apple: Cash-Generating Machines

Strong cash flows reflect financial stability, allowing companies to pay down debt, pursue growth opportunities, and shell out dividend payments.

These companies are also better equipped to weather downturns, providing another beneficial advantage for investors from a long-term standpoint.

And for those seeking cash-generating machines, two companies – Visa V & Apple AAPL – fit the criteria nicely, with each also on the reporting schedule in the coming days. Let’s take a closer look at how each currently stacks up.

Apple

Apple has long been a cash-generating machine, providing many benefits over the years, including higher dividend payouts. In fact, Apple has paid higher dividends for 13 consecutive years, owing to its shareholder-friendly nature.

Shares yield a modest 0.4% annually, though the company’s 5.0% five-year annualized dividend growth helps bridge the gap. On a trailing twelve-month basis, the tech titan has generated a massive $129.1 billion in free cash flow.

EPS and sales revisions for the upcoming release have risen over the last several months heading into the release, showing a high level of stability.

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Visa

Visa has similarly sported a long-established reputation of generating huge amounts of cash, with its overall defensive qualities also a big positive of the stock. The company is well on its way to becoming a Dividend Aristocrat, upping its payouts for roughly 17 consecutive years.

Shares yield a respectable 0.8% annually at the present, with Visa also sporting a sizable 16.3% five-year annualized dividend growth rate. The financial titan has generated $21.2 billion in free cash flow over the trailing twelve months.

The outlook heading into the release is positive, with both EPS and sales expectations trending higher over recent months.

See also <!DOCTYPE html><html><head><meta charset="UTF-8"><meta name="viewport" content="width=device-width, initial-scale=1.0"><title>Insights into Social Security's 2025 Cost-of-Living Adjustment and Its Impact on Retirees</title></head><body><h2>The Integral Role of Social Security COLA for Retirees</h2><p>Retired Americans rely on their Social Security checks not just as a sheet of paper, but as a vital financial resource. Figures indicate that this leading retirement program was instrumental in lifting a significant portion of the elderly out of poverty, with 22.7 million individuals benefiting in 2022 alone. Among them, 16.5 million were aged 65 and above.</p><p>Statistics from a recent Gallup survey underscore the profound reliance on Social Security income, revealing that merely 11% of retirees can cover their expenses without it. Consequently, the annual cost-of-living adjustment (COLA) announcement becomes a highly anticipated event, given its direct impact on the financial well-being of millions.</p><h2>The Fundamentals of Social Security's COLA Mechanism</h2><p>Since the mid-1970s, Social Security has employed the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) as the yardstick for its COLA calculations. This index encapsulates eight major spending categories and a multitude of subcategories, thus providing a comprehensive snapshot of inflationary trends.</p><p>In contrast to the pre-1975 era of sporadic benefit adjustments at Congress's discretion, the current system ensures a transparent and structured approach to maintaining retirees' purchasing power. Furthermore, the exclusive use of trailing 12-month data from the third quarter for COLA computations adds a layer of precision to the process.</p><h2>Understanding the 2025 COLA Predictions</h2><p>Following a series of robust COLAs in recent years, forecasts for the 2025 adjustment are gaining clarity. Notable deviations from the historical trends have raised hopes among retirees, with three consecutive years witnessing above-average increases. Should the 2025 adjustment exceed 3%, it would signify a notable milestone, not seen in over three decades.</p><p>The release of the June inflation figures by the U.S. Bureau of Labor Statistics has prompted experts to fine-tune their predictions. The Senior Citizens League (TSCL) has cautiously raised its forecast to align with the two-decade average, while independent analyst Mary Johnson has adjusted her estimate downward, in light of the evolving inflationary landscape.</p></body></html><!DOCTYPE html><html lang="en"><head> <meta charset="UTF-8"> <meta name="viewport" content="width=device-width, initial-scale=1.0"> <title>Social Security COLA Concerns for 2025</title></head><body> <article> The Looming Storm: Social Security COLA Concerns for 2025

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Bottom Line

Companies with strong cash-generating abilities are great targets, as they have plenty of cash to fuel growth, pay out dividends, and easily wipe out debt. And as mentioned above, these companies are better equipped to handle an economic downturn, undeniably a positive.

For those seeking cash-generators, both companies above – Visa V and Apple AAPL – fit the criteria nicely, with each also on the reporting docket in the coming days. EPS and sales revisions for each has remained positive over recent months, providing a nice level of positivity and stability as we inch closer.

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