The stocks of these companies provide the opportunity for outsized future growth. However, these securities also add the possibility for an outsized risk to the downside. Just about any group you can think of has its all-stars that lead the rest of the pack (think baseball).
- The S&P 500 was up 7.3% year to date, while The S&P SmallCap 600 was down 3.3%, as of May 16.
- Albemarle’s Chile assets offer a very low-cost source of lithium.
- These companies have stood the test of time and are respected by their customers and their shareholders.
- You don’t want your wealth resting entirely on Chevron and ExxonMobil, for example.
- A blue chip company typically has a market capitalization in the billions.
Thanks to their relative stability and safety, blue-chip stocks function well as core portfolio holdings—particularly for novice investors and those who prefer low-maintenance stocks. The dividends also ease the stress of bear markets and provide funding to reinvest at the best possible time, when share prices are low. Fiscal year 2023 adjusted earnings per share rose to $6.46 from $5.48 in the prior year. Banking giant JP Morgan has offered investors the highest shareholder yield of any company on this list.
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Blue chips get their name from the game of poker, where a blue chip has the highest value and is the most attractive to players. Our in-house research team and on-site financial experts work together to create content that’s accurate, impartial, and up to date. We fact-check every single statistic, quote and fact using trusted primary resources to make sure the information we provide is correct. You can learn more about GOBankingRates’ processes and standards in our editorial policy.
Partnerships are not a recommendation for you to invest with any one company. Please note that the stocks above were selected by an experienced financial analyst, but they may not be right for your portfolio. Before you decide to purchase any of these stocks, do plenty of research to ensure they are aligned with your financial goals and risk tolerance. The second-largest investment bank in the world by revenue, Goldman Sachs stock fell 10.2% in 2022 as the Federal Reserve tightened monetary policy amid rampant inflation.
What Are the Morningstar Fair Value Estimate, Style Box, and Capital Allocation Rating?
Over time, you can build a large portfolio of dividend-paying blue-chip stocks to sustain a comfortable retirement. Blue-chip stocks are the very best companies in their respective industries. Their large businesses typically have many years, if not decades, of successful operations to back up the valuation.
We believe everyone should be able to make financial decisions with confidence. After choosing the target stocks, select your entry points or attractive price points. You can use price points to set limit orders for the blue-chip stocks in a brokerage account. You can base price targets on past price action, technical indications like the 150-day EMA or even the analysts. The analysts’ targets, the consensus target, is a closely watched figure for most blue-chip stocks and will often produce strong moves when reached, touched or crossed by the price action.
Where Does the Term “Blue Chip” Come From?
Gains that come purely from stock price increases, on the other hand, can be elusive. Those gains aren’t definitively yours until you liquidate the position. Finder.com is an independent comparison platform and
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In a world where consumers flock to the latest tech fads, Apple’s products engender notable loyalty from its customer base. UnitedHealth is one of the largest healthcare companies in the U.S., thanks to a string of acquisitions that have added depth and diversity to its operations. The company insures more than 51 million people and expects to add at least one million over the next year.
Where does the term “blue-chip” come from?
They’re not foolproof — no equity investment is — but these known quantities take some of the guesswork out of stock analysis and selection. Blue chips have the size, financial strength and cash flow to pay dividends. Those dividends are a primary reason why these stocks deliver higher total returns in soft markets. Forbes Advisor has surveyed the stock market to pick the best blue chip stocks.
A stock is also classified as either small-cap, mid-cap, or large-cap based on its market capitalization. In addition to receiving dividends, many blue chip stocks give investors the ability to reinvest their dividends. Reinvesting https://forexarticles.net/hyperforex-broker-overview/ dividends is a solid strategy that can boost total return and deliver the benefit of compounding. A blue chip stock is stock issued by a large, well-established, financially-sound company with an excellent reputation.
Lincoln National reported fourth quarter and full year 2022 results on February 8th, 2023, for the period ending December 31st, 2022. The company had net income of one penny per share in the fourth quarter, which compared unfavorably to $1.20 in the fourth quarter of 2021. Adjusted net income equaled $0.97 per share compared to $1.56 in the same prior year period. Additionally, annuities average account values shrunk by 16% to $144 billion and group protection insurance premiums grew 9% to $1.2 billion. For the year, revenue grew 120% to $7.3 billion while adjusted earnings-per-share totaled $22.84 compared to $4.05 in the prior year. On April 19th, 2023, Zions Bancorporation released its first quarter 2023 results for the period ending March 31st, 2023.
Fair value estimates are rooted in the fundamentals and based on how much cash we think a company can generate in the future, not on fleeting metrics such as recent earnings or current stock price momentum. Learn more about how Morningstar values stocks in Morningstar’s Guide to Stock Investing. The company repurchased 8.7 million shares of stock for $550 million in the trailing twelve months, reducing the share count by 7%.