Forever is a long time, and few companies have the business fundamentals to grow profitably for decades. It’s an especially tough ask in the technology sector, where innovation is constantly nipping at your heels. Against the odds, some technology companies stand a reasonable shot at being successful “buy and hold” stocks for years to come. Here are five dominant companies that can generate loads of cash to keep competitors at bay and get shareholders through tough times.
Technology conglomerate Microsoft (MSFT -0.23%) is one of the most powerful software companies. Its Windows operating system has dominated for decades; 75% of the world’s computers and tablets use it. Microsoft’s Azure is the world’s second-leading cloud infrastructure provider, owning 21% of the global market.
Microsoft has continued growing, earning more free cash flow and net income (bottom line profit) over decades, evolving its business to capture new opportunities. For example, Azure is a key piece of Microsoft today, but it didn’t exist until 2010! The company has about $104 billion in cash and short-term investments — immense resources to continue investing in new products or acquisitions.
Telecommunications company AT&T (T 0.94%) is the leading wireless network provider in the United States, with 67 million phone customers and another 6 million using fiber internet. The infrastructure that powers wireless networks costs billions of dollars that AT&T has invested over the years. The expensive nature of the industry makes it unlikely that new competitors will spend that sort of money just to attempt to challenge existing leaders like AT&T.
You can see in the chart above how these large investments have caused some volatility in the company’s finances, but free cash flow and profits have trended higher over the long term. AT&T tried and failed to get into streaming, which loaded…
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