Sigma-Aldrich
Market capitalization: $8.8 billion
Percentage of sales from outside the U.S.: 67%
With more than 176,000 products and next-day delivery anywhere in the world, Sigma-Aldrich (SIAL) is the premier go-to chemical company for the drug and technology industries.
Its chemicals are used in biotechnology and pharmaceutical development, diagnosis of diseases and high-tech manufacturing. Sigma recently bought biological-testing company BioReliance, which serves about 90% of top biotech firms and 75% of leading pharmaceutical companies, in a deal that's supposed to boost earnings immediately, to the tune of about 5 cents per share this year.
The St. Louis company sports a strong balance sheet. Earnings are expected to grow at a rate of 9% a year over the next three to five years.
Waters
Market capitalization: $7.5 billion
Percentage of sales from outside the U.S.: 70%
Waters (WAT) makes scientific instruments that are used in food-safety analysis and pharmaceutical research, including clinical trials. Based in Milford, Mass., Waters has $1.3 billion in cash and just $700 million in debt on its balance sheet. The company has been using its cash to buy back stock and has reduced the number of shares outstanding by nearly 12% over the past five years.
When it comes to turning sales into profits, few research companies do it better. For every dollar of sales the company generates, it brings about 23 cents to the bottom line. Analysts expect earnings to grow at an annualized clip of 12% for the next three to five years.
Xilinx
Market capitalization: $8.6 billion
Percentage of sales from outside the U.S.: 67%
Xilinx (XLNX) makes programmable semiconductor chips that can be customized for new products. That saves inventors of everything from phones to tablets the time and expense of designing a special chip for a newly launched gizmo until they have the sales volume to know it will fly.
Xilinx and rival Altera (ALTR) control more than 70% of the programmable chip market. What's more, Xilinx is a cash machine, generating more than $500 million in cash annually. That has helped the San Jose, Calif., company build a $2 billion cash hoard (it has $900 million in outstanding debt).
The cherry on top: Xilinx sports a 2.7% dividend yield -- unusually high for a technology company.
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