What are all us blue chip company's with strong cash flows i.e. relatively low pe ratio
9/19/2025 09:27am
**Quick takeaway 🚦**
Among U.S. “blue-chip-sized” companies (>$100 B market cap) that still trade at ≤15× trailing earnings, the five that also generate positive free-cash-flow today are:
| Rank | Ticker | Company | P/E (TTM) | Free-Cash-Flow Yield* | Comment |
|------|--------|---------|-----------|-----------------------|---------|
| 1 | **PGR** | Progressive | 13.6 | 2.8 % | Defensive, rate-hardening cycle boosts underwriting cash. |
| 2 | **VZ** | Verizon | 10.1 | 2.7 % | 7.1 % dividend backed by stable wireless cash flows. |
| 3 | **UNH** | UnitedHealth | 14.2 | 2.1 % | Best-in-class managed-care margin, secular tailwinds. |
| 4 | **MRK** | Merck | 12.4 | 1.2 % | Oncology franchise throws off steady FCF; patent cliffs fade. |
| 5 | **COF** | Capital One | N/A† | 3.9 % | FCF solid but headline loss skews P/E; credit cost risk. |
\*FCF Yield = last reported FCF ÷ market cap
†COF shows a negative P/E because of one-off accounting loss, so its “cheapness” needs context.
Data as of 18 Sep 2025
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### How to interpret the list 🧐
1. **Quality of cash flow:** Positive FCF alone isn’t enough—you want durability. UNH, MRK, and VZ sell recurring-revenue services, which historically hold up in slowdowns.
2. **Rate-cut backdrop:** A lower Fed Funds rate tends to (a) compress bank net-interest margins—watch COF—and (b) lift equity valuations for steady cash generators like UNH and MRK.
3. **Dividend support:** VZ’s and MRK’s payout ratios sit comfortably below 65 %, suggesting their dividends are covered even if earnings wobble.
4. **Cyclicality check:** COF’s consumer-credit exposure makes it more cyclical than the others; use it as a tactical, not core, position.
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### Next steps you could take
• Dig one level deeper—e.g., compare **three-year FCF growth** or **net-debt-to-FCF** to separate genuine cash machines from value traps.
• Overlay technicals (e.g., 200-day moving average) to pinpoint tactical entry points after today’s Fed-driven rally cools.
• Consider a **basket approach** (equal-weight PGR/VZ/UNH/MRK) to diversify sector risk while keeping the low-P/E, positive-FCF theme intact.
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*Out of curiosity—what final goal are you aiming for with this screen: building a high-dividend core, or hunting for undervalued growth rebounders?* 🤔