Best blue-chip stocks of 2024
Updated 9:00 a.m. UTC July 12, 2024
Editorial Note: Blueprint may earn a commission from affiliate partner links featured here on our site. This commission does not influence our editors' opinions or evaluations. Please view our full advertiser disclosure policy.
During economic uncertainty, one of the best ways to protect your portfolio is to load up on blue-chip stocks. Blue-chip companies are large companies with valuable brands, industry-leading businesses, and long track records of stability and profitability.
The best blue-chip stocks also have attractive valuations based on fundamental metrics, such as price-to-earnings ratio, price-to-book ratio and dividend yield.
We selected the best blue-chip stocks of 2024 based on the following factors: significant upside potential, strong net income balance sheets and bullish “buy” ratings from Wall Street analysts.
Best blue-chip stocks
- UnitedHealth Group (UNH).
- Nvidia Corp. (NVDA).
- JPMorgan Chase & Co. (JPM).
- Salesforce (CRM).
- Caterpillar (CAT).
Compare the best blue-chip companies
Methodology
The best blue-chip stocks included above all trade on a major U.S. stock exchange and meet the following criteria:
- Member of the S&P 500 index. The S&P 500 index is often used as a broad view of the U.S.’s economic health. The famed benchmark includes many large-cap companies, which tend to be less volatile.
- Consensus analyst recommendation of “buy” or better. A high number of analyst “buy” ratings indicates an expectation the stock will outperform the overall market.
- Positive net income in at least four of the past five years. Blue-chip stocks are consistently profitable, which is a reflection of their proven business models. Screening for profitability in at least four of the past five years doesn’t penalize companies that were temporarily unprofitable during the COVID-19 economic shutdowns in 2020.
- Market capitalization of at least $100 billion. If a company has a leading market share and competitive advantages in a sizable industry, it will have a market cap of greater than $10 billion. For this list, all capitalizations are greater than $100 billion, as blue-chip companies hold large market capitalizations. Small- and mid-cap stocks are not typically considered blue-chip stocks.
Why other stocks didn’t make the cut
The best blue-chip stocks demonstrate consistent profitability and steady or growing revenue. They also have an attractive valuation based on fundamental metrics such as P/E ratio, P/B ratio and dividend yield.
Even though a stock is large or is an industry leader, it may be a better investment. A large company can have an eroding business model. General Electric (GE) was the most valuable company in the S&P 500 in 2005. But mismanagement and restructuring missteps made it a horrible investment years later. So even though many well-seated large-capitalization stocks may have a prior history of strong earnings, it’s important to look carefully at the current business model and future income generation.
Final verdict
Blue-chip stocks offer a good way to start investing since these are relatively low-risk investments. In this volatile stock market environment, focusing on high-quality stocks trading at reasonable valuations is prudent.
"Investors should be maintaining discipline if their portfolio is properly aligned with their goals and objectives," says David Bahnsen, chief investment officer at The Bahnsen Group.
A solid blue-chip stock generally ticks these boxes, since they typically hold a strong reputation and a long history of delivering returns.
Nvidia is among the best blue-chip stocks on this list but isn’t part of the Dow Jones Industrial Average (DJIA). However, Nvidia is among the top 20 companies with the largest market caps in the U.S.
The other blue-chip stocks listed — JPMorgan Chase & Co., Salesforce, Caterpillar and UnitedHealth Group — are among the 30 companies that make up the DJIA. They are also large in market capitalization, ranking within the top 85 companies in terms of size with more than $140 billion in market cap.
Frequently asked questions (FAQs)
The 30 stocks included in the DJIA are all considered to be blue-chip stocks. These include:
- American Express (AXP)
- Amgen (AMGN)
- Apple (AAPL)
- Boeing Co. (BA)
- Caterpillar (CAT)
- Cisco Systems (CSCO)
- Chevron (CVX)
- Goldman Sachs (GS)
- Home Depot (HD)
- Honeywell International (HON)
- International Business Machines (IBM)
- Intel (INTC)
- Johnson & Johnson (JNJ)
- Coca-Cola Co. (KO)
- JPMorgan Chase & Co. (JPM)
- McDonald’s (MCD)
- 3M Co. (MMM)
- Merck & Co (MRK)
- Microsoft (MSFT)
- Nike (NIKE)
- Procter & Gamble Co. (PG)
- Travelers Companies (TRV)
- UnitedHealth Group (UNH)
- Salesforce (CRM)
- Verizon Communications (VZ)
- Visa (V)
- Walgreens Boots Alliance (WBA)
- Walmart (WMT)
- Walt Disney Co. (DIS)
- Dow (DOW)
But there are plenty of other blue-chip stocks as well. Companies like Alphabet (GOOGL), Amazon.com (AMZN) and Nvidia (NVDA) would generally be considered blue-chip stocks, but are not included in the DJIA.
Dividend yields vary by company, but energy stocks, telecommunications stocks and real estate investment trusts often have some of the highest dividend yields in the market. Blue-chip stocks with high dividend yields include Walgreens Boots Alliance (WBA) and 3M (MMM), which both deliver more than a 5% yield.
Blueprint is an independent publisher and comparison service, not an investment advisor. The information provided is for educational purposes only and we encourage you to seek personalized advice from qualified professionals regarding specific financial decisions. Past performance is not indicative of future results.
Blueprint has an advertiser disclosure policy. The opinions, analyses, reviews or recommendations expressed in this article are those of the Blueprint editorial staff alone. Blueprint adheres to strict editorial integrity standards. The information is accurate as of the publish date, but always check the provider’s website for the most current information.