How Many Blue Chip Stocks Are There on the Stock Market? The Motley Fool

This makes them a conservative option for investors looking for a safe bet for their already established portfolio. You can also begin to establish your portfolio using these same assets, especially if you have enough money to invest in something that’s a bit more expensive. While you don’t want to overspend, you also want to hold onto assets that are more appropriate for you. Visa has met or beaten earnings expectations for 4 straight quarters and has seen both profit and revenue growth in each of the last 5 years. With a firm foothold in the payments processing industry, Visa will likely be a blue chip stock for many years to come. Nike’s brand power — and the pricing power that comes with it — makes the company a true blue chip.

Remember, not all blue chip stocks are the same, but they have underlying characteristics that make them easy to spot. Along with Mastercard, Visa is 1 of 2 primary credit card companies functioning in the United States, with American Express and Discover following behind. Visa has a $450 billion market cap, which surpasses Mastercard by more than $100 billion. Visa has become more than the credit card provider though — it’s a multifaceted payments processing company with a wide range of products and an international footprint. American Express Company is a globally integrated payments company. It provides customers with access to financial products that enrich lives and build business success.

Top 30 US companies

In our current bull-run, speculative meme stocks have also been in focus. However, even a high-risk portfolio needs to have some exposure to blue-chip stocks. That’s why many investors turn to low-cost index funds or exchange-traded funds instead. These funds contain a curated collection of investments and allow you to purchase a large selection of stocks in one transaction. It’s easy and instant diversification — at least, of course, among blue-chip companies.

• That efficiency supports ongoing investment in Visa’s global financial network as well as share buybacks and dividend payments.
• Exposure to the energy sector is likely to deliver returns in 2022.
• In poker, blue chips are the highest-valued and most desirable chips.
• In addition to rising rates domestically, the international economy could face headwinds given that China’s exports fell in October for the first time in over two years.
• Since Visa makes its money on transaction fees, the company performs well when spending rises.

Blue-chip stocks are established, financially strong, and consistently profitable publicly traded companies. Since Visa makes its money on transaction fees, the company performs well when spending rises. That’s a good thing, since the economy generally grows more than it contracts. Higher prices raise average transaction values, which in turn generates more fees. 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.

Silicon Valley Bank collapse: Which ETFs and stocks are impacted?

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And speaking of ETFs, another benefit of blue chip stocks is that investors can find an ETF that specializes in blue chip stocks. This is a great option for investors who don’t want to purchase individual stocks or simply want a more set it and forget it option for this percentage of their portfolio. Blue-chip stocks tend to be among the most stable, best-performing stocks available to retail investors.

Blue Chips as Part of a Larger Portfolio

Our information is based on independent research and may differ from what you see from a financial institution or service provider. When comparing offers or services, verify relevant information with the institution or provider’s site. However, these companies have loyal consumers that are willing to seek out their brands at the expense of their competitors. In addition to rising rates domestically, the international economy could face headwinds given that China’s exports fell in October for the first time in over two years.

• The energy supermajor’s stock price has nearly doubled since it was removed from the Dow Jones Industrial Average at the end of August 2020.
• Overall, CVX stock seems positioned for further rally in 2022.
• Despite unfavorable macro conditions, the stock fell less than 2% in 2022, compared to the S&P 500, which dropped almost 20%.
• The large net loss in the quarter was due primarily to unfavorable impacts as a result of a portion of the MRB and hedge instrument fair value changes from the recent adoption of LDTI.

For example, the Dow Jones has made changes to its elite 30-member blue chip list 57 times in its 124-year history, most recently in 2020. The index recently replaced Exxon, Pfizer, and Raytheon with Salesforce.com, Amgen, and Honeywell International. It added the latter trio to increase its exposure to technology stocks, add a biotech stock, and bring back a former long-standing Dow stock, respectively.

Pros and Cons of Blue Chip Stocks

In the third quarter of its 2022 fiscal year, Nike reported year-over-year digital sales growth of 19%, which was an impressive feat considering the company’s massive scale. Nike is targeting half of total revenue to come from online and direct-to-consumer sales within the next couple years. They are the most stable, profitable, and enduring companies, which generally makes them among the safest investments and, like a blue chip in poker, highly valuable to investors. Blue chips are generally considered the best-known, most established, and best-capitalized companies in the world. Investors of all experience levels can appreciate the stability and reliability that blue chip businesses give to shareholders. Many of these companies pay great dividends and have payout growth streaks that have earned them a spot among the illustrious ranks of the Dividend Kings.

Many successful long-term investors like Warren Buffett have advocated for investing in companies you believe will be around for a generation or two. The kind of stocks that tend to fit that description are the blue chips that continue to show steady returns. This pricing power also means these companies generate positive free cash flow (FCF) which they can use to reward shareholders. A dividend payment is a way for shareholders to “collect rent” on the shares they own. Investing in blue chip companies that pay dividends can significantly increase your wealth over time. Although the stock market constantly gains and loses value, these stocks often exhibit below-average volatility while delivering market-beating returns over long time horizons.

That massive membership base is a competitive advantage for UnitedHealth, one the company can use to sell more services. UNH is also leveraging technology to improve outcomes and lower costs. 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. PG reported fiscal 2022 non-GAAP organic sales growth of 7%, along with non-GAAP core EPS growth of 3%.

Blue chips are elite by any measure

Blue chip dividend-paying stocks are strong additions to portfolios of all kinds, especially for investors seeking stability and income. It’s important to note that Berkshire Hathaway is the only blue chip stock on this list that doesn’t pay a dividend. CEO Warren Buffett has one of the most impressive track records of market-beating returns in history and prefers to invest the company’s cash in lieu of https://g-markets.net/helpful-articles/shooting-star-pattern-forex/ paying dividends. Investors can add new stocks they find or become interested in and also cut out any that don’t maximize the portfolios’ goals. What makes the right blue chip stocks depends on the investor, the goal of the portfolio and the allocation targets for holdings. A $1,200 stock may be attractive for many reasons, but the price is so high it may be a problematic fit for smaller portfolios.

In a world in which technology is growing in importance, Broadcom’s chips are an absolute staple. The deployment of 5G mobile networks in many markets is likely to boost sales of the iPhone, which made its debut with a 5G chip in late 2020 with the iPhone 12. Click here to instantly download your free spreadsheet of all 350+ Blue Chip Stocks now, along with important investing metrics. In its fiscal 2022, Visa grew revenues by 22% and non-GAAP EPS by 27% on higher payments volume and growth in processed transactions.

Clothing bearing the Nike « swoosh » logo is sought after by consumers around the globe. With the global middle class growing rapidly, Nike is the elite brand in athletic footwear and apparel. Even the COVID-19 pandemic only put a temporary drag on Nike’s upward momentum since spending on the company’s products recovered quickly. Management’s target is to return half of the previous year’s free cash flow to shareholders via its dividend, which has equated to fantastic income increases for owners of this tech stock. With another billion people set to join the global consumer class over the next decade, Mastercard still has plenty of opportunities to expand its payment processing network.

Apple (AAPL)

After combining with Adenza, this business will comprise the financial technology segment and contribute 36% of revenues. As the controversy enters its fourth month, the company continues to respond with what seems like a new marketing campaign every week. Instead, it seems the more they keep “messaging” the more pressure goes on the stock.