Blue-chip stocks, those market-leading, large capitalization companies with strong brands, typically has long track records of earnings and cash flow growth. Investors see them as relatively safe equities investments, even when stocks come under pressure during economic contractions.
For those looking for a steady ride in 2021, today’s article introduces seven blue-chip stocks for consideration.
Due to their size, blue-chip businesses tend to benefit from economies of scale, have access to a broad range of resources and can invest in new technologies. Other key characteristics include leadership in their given industries, seasoned management team, diverse revenue streams, steady cash flow and earnings growth, and relatively long company history. Their solid balance sheets also enable them to have access to low-cost financing.
The term “blue-chip” comes from the game of poker, where blue-chips are the ones that are worth the most. Similarly, publicly listed blue-chip companies usually are among the most valuable in stock markets. They can typically weather economic crises with minimal losses both in terms of financial assets and brand value. They may continue to grow earnings and cash flow, even under challenging economic conditions. Therefore, they are usually among the favorite investments for long-term investors.
Most blue-chip companies are also steady dividend payers. Seasoned market participants believe that investing in blue-chip stocks with dividends is a cornerstone to building wealth over the long term. While the stock market has been red-hot, there are worthwhile deals on the Street, especially among blue-chip shares.
On our list today are the following seven blue-chip stocks to buy in 2021:
- BAE Systems (OTCMKTS:BAESY)
- Cisco Systems (NASDAQ:CSCO)
- Coca-Cola (NYSE:KO)
- CVS Health (NYSE:CVS)
- Home Depot (NYSE:HD)
- JPMorgan Chase (NYSE:JPM)
- Pfizer (NYSE:PFE)
Blue-chip stocks: BAE Systems (BAESY)
- 52-Week Range: $19.89 – $34.74
- Dividend Yield: 4.4%
Our first stock comes from the other side of the Atlantic. London-headquartered BAE Systems offers aerospace and defense (A&D) solutions globally. Many investors find the sector reliable as clients are typically national governments with rich defense budgets. Military contracts also tend to have long lives.
BAE Systems’ operations can be found 40 countries. The company employs around 90,000 people people worldwide. Governments of the U.S., U.K., Australia, continental European countries, Qatar and Saudi Arabia are its top customers.
Over the past year, BAESY stock is down about 10%. The current stock price supports a dividend yield of 4.41%, making the company particularly attractive to passive income seekers. BAE Systems released results in late July, as well as a trading update in November.
Half-year revenue came at GBP 9.2 billion ($12.6 billion),…