Apple Inc. (AAPL) Is In Jim Cramer’s New Lifestyle Index

As John noted the company has reinvented what a drugstore is with the purchases of Duane Reade and Alliance Boots. Cramer also liked their new strategic partnership with Amerisouce Bergen, a pharmaceutical distributor. All these bode well for a strong supply chain and growth abroad.

This is the sole Dividend Aristocrat of the Lifestyle Index having raised its yield for 37 years. It has paid a dividend continuously since 1933. The yield is 2.30% at a payout ratio of 47%. The P/E is 21.46 but going forward drops to 13.08.

The stock has run 46% in the last 52 weeks as Walgreen recovers from the fallout with Express Scripts. Analysts expect 12.88% five year EPS growth. Don’t forget the ever-rising yield!

Just one word…plastics

Finally, John liked Visa. He said we’re all broke and putting money on our plastic. More transactions means more money in Visa’s pockets. Visa’s profit margin is 22.46% and its operating margin is 59.93%.

Visa is a great way to play the famous line, “Plastics…There’s a great future in plastics,” from The Graduate. Visa may not be coolness personified except to shareholders who’ve enjoyed some very cool profits as share price has risen 36% in the last year alone.

Its P/E is pretty pricey at 46.15, but drops down to a forward P/E of 19.52. Ironically maybe, the company has no debt. Analysts see an 18.30% five year growth rate but that is a decline from the smoking 27.95% rate of the last five years. Long term, credit card companies may be pressured by the mobile wallet trend.

Visa has a yield of .80% at a 39% payout ratio. Its corporate governance risk is a favorable 2.

A Fool takeaway on cool

All these companies are interesting cool plays on financials, health care, retail, and tech. On valuation, Apple Inc. (NASDAQ:AAPL) stands tall on valuation but sentiment is bearish.

For growing yield there’s Walgreen, but for the hipper (or hipster) Urban Outfitters is a good name. Lastly, Visa has been a reliable outperformer and plastic isn’t going away.

AAPL Total Return Price data by YCharts

The article The Kings of Cool: Cramer’s Lifestyle Index originally appeared on Fool.com and is written by AnnaLisa Kraft.

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