The amount of cash a company has is a critical consideration no matter the circumstances.
As Warren Buffett once said, “Cash is to a business as oxygen is to an individual…” But where can an investor find cash-heavy companies inside the S&P/ASX 200 Index (ASX: XJO) outside of the typical major banks and miners?
Firstly, there is nothing wrong with investing in banks and mining giants. Some of those companies have even outperformed the benchmark index over the last five years. However, being concentrated in these sectors can come with risks, as is with any form of concentration.
At the end of the day, strong balance sheets are what matters. So, what are a few options for investors seeking cash behemoths beyond the two dominant sectors of the ASX?
Here are a few ASX 200 shares with billions to boot.
ASX 200 shares with bank accounts burst at the seams
CSL Limited (ASX: CSL)
Starting from the top, Australia’s largest healthcare company — CSL — claims the largest stash of cash apart from the banks and miners. Sitting atop A$8.73 billion in cash and cash equivalents, the biotechnology giant has a fortified balance sheet.
Although, it is important to note this amount is likely to change as CSL moves toward the acquisition of Vifor Pharma. In December 2021, the ASX-listed company designated A$8.4 billion of new debt and existing cash to partly fund the A$17.2 billion acquisition.
Block Inc (ASX: SQ2)
Another ASX 200 share with billions to its name is US-based fintech company, Block (formerly Square). At the end of March 2022, the Afterpay and Cash App owner counted A$6.6 billion on its balance sheet. This is despite operations becoming unprofitable for the trailing 12-month period.
In addition, it is worth highlighting that Block has a chunk of debt that is almost equivalent to its cash levels. Based on this, the company’s net cash level is approximately A$142 million.
ASX Ltd (ASX: ASX)
The final company to stand out among a spattering of banks and mining companies is Australian stock exchange operator, the ASX. With profit margins consistently above 40%, it’s no wonder this ASX 200 company has accumulated billions.
At the end of December 2021, the ASX had reached a bountiful $7.344 billion in cash and cash equivalents. That amount of money ensures plenty of cushioning during a down.
Recently, Catapult Wealth portfolio manager Tim Haselum named this company as its pick to hold if the market was closed for four years.
The post 3 ASX 200 shares swimming in billions, besides banks and miners appeared first on The Motley Fool Australia.
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Motley Fool contributor Mitchell Lawler has positions in Block, Inc. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Block, Inc. and CSL Ltd. The Motley Fool Australia has positions in and has recommended Block, Inc. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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