Is the Market Overvalued? Billionaires Buffett, Dell Vote ‘No’ – Dell Inc. (DELL), Oracle Corporation (ORCL)

Officials at H.J. Heinz stated that keeping the company’s headquarters in Pittsburgh is written in the merger documents, although management changes have not been discussed. 3G Capital, which also owns Burger King Worldwide, will be the operational partner in the $28 billion takeover. For more information on 3G Capital, please reference my article Heinz Ketchup: Only Available on a Whopper Sandwich?.

Foolish Bottom Line

What’s the lesson here? My takeaway is simple: it’s still a good time to own stocks for the retail investor. Despite tepid growth in the world’s economies, Corporate America has the strongest balance sheet in decades, collectively holding trillions of dollars in cash. With interest rates at historic lows, deal making is bound to continue.

Even in the absence of future deals, valuations at large cap companies are supported by strong free cash flow and healthy dividend yields. For instance, technology giant Dell Corporation has a pristine balance sheet, and the company’s dividend yield of nearly 2.5% is significantly higher than US Treasuries. Readers should look for large-cap companies of a similar nature, and there are plenty of them. These stocks will be pushed higher in the search for safety and yield.

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The article Is the Market Overvalued? Billionaires Buffett, Dell, Ellison All Vote ‘No’ originally appeared on Fool.com and is written by John Macris.

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