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Insightful Information About Stocks With Strong ROIC Exploring Long-Term Value: 3 Stocks With a Remarkable Return on Invested Capital (ROIC)

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Exploring Long-Term Value: 3 Stocks With a Remarkable Return on Invested Capital (ROIC)
long-term value stocks - Looking for Long-Term Value? 3 Stocks With a Strong Return on Invested Capital (ROIC)

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Looking for long-term value stocks that are fundamentally strong and boast an attractive return on invested capital is essential for astute investors. These investments not only offer stability but also the potential for significant returns. Let’s dive into the reasons to be upbeat about these value stocks with a high ROIC.

Tesla (TSLA)

Tesla (TSLA) supercharging station during the day.

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Over the past three years, Tesla (NASDAQ:TSLA) has demonstrated an average ROIC of 20.34%. Despite other companies achieving higher averages during this period, Tesla’s undervalued status makes it a compelling investment choice. With plans to revolutionize the electric vehicle industry and expected annual EV production of 20 million units by 2030, Tesla is poised to create long-term value for investors. Additionally, the company reported an impressive $13.3 billion in operating cash flow for 2023, indicating its strong financial position and potential for substantial cash flow growth in the future.

Home Depot (HD)

Home Depot (HD) sign backdropped by blue sky

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Home Depot (NYSE:HD) stands out as another appealing long-term value stock, boasting an average ROIC of 32.99% over the last three years. With a favorable forward price-earnings ratio of 23.3 and a dividend yield of 2.3%, HD stock presents a compelling investment opportunity. As the U.S. economy gears towards increased consumer spending and potential rate cuts loom, Home Depot is poised to benefit from enhanced consumer purchasing power. Despite a 3% decline in revenue for the last financial year, the company reported robust operating cash flow of $21.2 million and announced a 7% increase in quarterly dividend, underlining its solid financial performance and growth prospects.

Altria (MO)

The Future of Altria – A Dormant Giant in the Making?

A Blue-Chip Opportunity

In a world of investment options, few feel as unloved and forgotten as Altria (NYSE: MO). This titan of tobacco and cigarettes has been in the business for ages, but today, it seems to be overlooked and undervalued.

For investors, however, this just might be the blue-chip opportunity they’ve been waiting for. Currently trading at a forward price-earnings ratio of 8, Altria offers a dividend yield of 9.76%. Tantalizing figures, to be sure. But that’s not all.

The Financial Fortitude

Altria’s average return on invested capital (ROIC) over the past three years stands impressively at 22.91%. Even over a decade, the average ROIC clocks in at 16.62%. These numbers are not just desirable; they portray a financial fortitude that is hard to come by.

Shifting Horizons

Beyond the financials, Altria is making strategic moves. It has been gradually pivoting away from the smokable segment, which has long been its cash cow. In 2023, the revenue from smokable products reached a substantial $78 billion, proving that the segment remains a robust cash flow generator for the company. Even amidst revenue de-growth, it’s clear that the smokable business will significantly support investments in Altria’s smoke-free ventures.

Diversification Efforts

As evidence of change, Altria reported a 3.4% revenue growth to $2.7 billion in the oral tobacco segment. In addition, the company is actively collaborating with regulators to eradicate illicit e-vapor products from the market. Once the dust surrounding regulatory uncertainties settles, this could emerge as another high-growth segment for Altria.

Investors seeing Altria merely as a tobacco giant may soon need to reset their view, as the company steers toward diversification and establishes strongholds in alternative revenue streams.

This evolution in strategy showcases the potential for a revitalized, robust Altria, one that may be a far cry from its historical tobacco roots.


As the finance world pivots towards more sustainable investing and ethical choices, Altria is playing a delicate game. Its endeavors in diversification and adapting to regulatory changes may well pay off in the long run, making the company an intriguing study amidst a rapidly changing landscape.

In the investment world, the neglected and misunderstood sometimes have the most potential. Altria may just fit that category. Only time will tell if this dormant giant will awaken to new opportunities or remain shrouded in its historical smoke.