What is the difference between a regular stock and a blue-chip stock?
Income stocks provide regular income by distributing a company's profits, or excess cash, through dividends that are higher than the market average. Blue-chip stocks are shares of well-established companies with a large market capitalization.
Common stocks provide ownership and the possibility of capital gains, whereas preferred stocks provide regular dividends and a greater claim on business assets. Blue-chip stocks give stability, while growth companies have the potential for high returns. Value stocks are sometimes undervalued options.
A blue chip stock is stock issued by a large, well-established, financially-sound company with an excellent reputation. Normally, such companies have operated for many years, have dependable earnings, and usually pay dividends to investors. A blue chip company typically has a market capitalization in the billions.
Investing in blue chips comes with advantages like steady dividend payments, portraying financial health and stability. They're less prone to extreme market fluctuations than smaller stocks, making them appealing for conservative investors looking to preserve capital while gaining modest but consistent growth.
Are blue-chip stocks high risk? Blue-chip stocks are not high risk, so they're popular among investors with lower risk tolerance. While blue-chip stocks aren't bulletproof, their history of resisting market downturns makes them an appealing choice for many investors.
During economic slowdowns, investors turn to blue chip stocks to protect their investments.
Stocks that are considered blue-chip stocks generally have these things in common: Large market capitalization. Market cap is a measure of the size and value of a company. Blue-chip stocks are often large-cap stocks, which typically means they have a market valuation of $10 billion or more.
- Chevron Corporation (NYSE:CVX)
- The Coca-Cola Company (NYSE:KO)
- The Home Depot, Inc. (NYSE:HD)
- Costco Wholesale Corporation (NASDAQ:COST)
- Walmart Inc. (NYSE:WMT)
- AbbVie Inc. (NYSE:ABBV)
- The Procter & Gamble Company (NYSE:PG)
- Pfizer Inc. (NYSE:PFE)
Home Depot: Headquartered in Atlanta, GA, this company stands as another distinguished blue-chip stock, dominating the home improvement retail sector.
Growth stocks
They promise high growth and along with it, high investment returns. Growth stocks are often tech companies, but they don't have to be. They generally plow all their profits back into the business, so they rarely pay out a dividend, at least not until their growth slows.
What are the 4 basic stocks?
At the highest level, classic culinary stocks can be categorized into four types: meat, poultry, fish, and vegetable. The French refer to stocks as the fond, or base, by which the foundation of a dish is developed.
| Label | Value |
|---|---|
| Exchange | NASDAQ-GS |
| Sector | Technology |
| Industry | Computer Manufacturing |
| 1 Year Target | $205.00 |
| Price ($) | 12-Month Trailing ROE Ratio (%) | |
|---|---|---|
| Marriott International, Inc. (MAR) | 220.09 | 1446.77 |
| Tempur Sealy International, Inc. (TPX) | 50.57 | 1275.77 |
| The Home Depot, Inc. (HD) | 351.81 | 1151.32 |
Some of the best stocks to invest in 2024 for beginners include Microsoft Corporation (NASDAQ:MSFT), Amazon.com, Inc. (NASDAQ:AMZN), and Mastercard Incorporated (NYSE:MA). For this list, we used a stock screener and selected stable companies with high single digit or low-teens revenue growth.
- Limited growth potential –Since these companies are well established, rapid capital appreciation is rarely seen. ...
- Overvaluation risk –The high 'brand recognition' of these stocks leads to a high degree of investor sentiment and could lead to them being overvalued.
| Returns (%) as of 12/31/2023 | QTD | 1 YR |
|---|---|---|
| Blue Chip - Gross | 10.17 | 24.44 |
| Blue Chip - Net | 9.76 | 22.59 |
| Russell 1000® | 11.96 | 26.52 |
| Returns for greater than one year are annualized | ||
For example, Coca-Cola is a blue chip company that might not suffer from a recession because many choose to drink its products, regardless of economic conditions. Blue chip companies have generally demonstrated stable growth rates throughout their history.
WMT, The Home Depot, Inc. HD and Costco Wholesale Corporation COST. Thanks to successful business operations, these bellwethers have withstood multiple market gyrations and delivered returns to investors. These blue-chip stocks have balance sheet strength to tackle any untoward market volatility.
Walmart (WMT)
Another one of the top blue-chip stocks to buy is Walmart (NYSE:WMT), which offers reliable dividend payments and steady appreciation. The equity has a 1.4% dividend yield and has gained 76% over the past five years.
| Company | Ticker symbol |
|---|---|
| ASML Holding | ASML |
| Bank of America | BAC |
| Blue Bird | BLBD |
| Brown & Brown | BRO |
What are 5 good stocks?
| Company | Performance (Year) |
|---|---|
| NVIDIA Corp (NVDA) | 212.06% |
| Meta Platforms Inc (META) | 211.14% |
| Builders Firstsource Inc (BLDR) | 118.37% |
| Uber Technologies Inc (UBER) | 114.24% |
Blue Chip companies are relatively low-risk, but it is critical to match your investments to your financial goals. Long-Term Prospects: Take a long-term approach to investing in Blue Chip stocks. These companies are best suited for investors with a five-year or longer time horizon.
| Name | Symbol | % Loss |
|---|---|---|
| Bajaj Finance | BAJFINANCE | -10.37 |
| Zee Entertainment Enterprises Ltd. | ZEEL | -8.51 |
| Bajaj Finserv Ltd. | BAJAJFINSV | -6.82 |
| Godrej Consumer Products Ltd. | GODREJCP | -6.41 |
Long-term investors own blue chip stocks because of their wide moats, dependable dividends and steady earnings. They can lend a stock portfolio ballast during periods of market turbulence.
Walmart has 6.39% upside potential, based on the analysts' average price target. Is WMT a Buy, Sell or Hold? Walmart has a conensus rating of Strong Buy which is based on 26 buy ratings, 4 hold ratings and 0 sell ratings.
