Intel: A "no-brainer" Buffett buy

It's become one of my favorite stocks. I like to call it my "no-brainer" investment for 2012. I've even selected it as one of my Top 10 Stocks for 2012.

The company is buying back billions of its stock. It has raised dividends at a torrid pace over the past five years. And the company just announced its sixth consecutive quarter of record sales.

And Warren Buffett's Berkshire Hathaway (BRK-B) has taken a 9.3 million share stake in the stock, a position worth over $200 million.

I'm talking about Intel (INTC). As the world's largest semiconductor maker, it holds an 80% stranglehold on the PC semiconductor market. No one else even comes close.
Some people may see the stock as "boring" and say that it hasn't gone anywhere for years. But I see something different, and I think Warren Buffett sees the same thing.

Simply put, Intel's shares are becoming more valuable quarter after quarter, but the share price hasn't responded yet.

• Intel is in the middle of an enormous share buyback spree. Over the past year, it has spent $11.5 billion to purchase 538 million shares. It still has $14 billion allocated to future buybacks -- that's more than 10% of the outstanding stock.
  
  
• The company holds more than $15 billion in cash on the books. That comes out to $2.97 per share... more than 11% of the current share price.
  
  
• Quarterly dividends have increased from $0.10 per five years ago to $0.21 per share today. That's growth of 110%. And in the last two years dividends have grown 50%.
  
  
• Right now, Intel's shares trade near the same level they did back in the spring of 2010, when earnings were just $1.09 per share during the previous 12 months. But today, earnings over the last year total $2.31 per share -- more than 100% higher.

It doesn't take the expert investing skills of Warren Buffett to see why Intel could go higher in the months and years ahead.

But there's another reason why I like Intel so much. After years of research, I've found that more often than not, companies that fit within a few simple categories are the ones that make you the most money long-term.

• Companies that enjoy huge (and lasting) advantages over the competition.
• Companies that are buying back massive amounts of their own stock.
• Companies that pay investors each and every year by dishing out growing dividends.

Intel fits all these characteristics perfectly. It's why I think it's a "no-brainer" investment. Strong companies that take care of their shareholders tend to do better over the long-run. It doesn't take a PhD to understand that.

Of course, with investing there's never a surefire thing. Even the seemingly strongest companies aren't guaranteed to deliver a positive return.

But that said, if you invest in companies with one or more of these three simple traits, then I think it gives you the best chance of making money.