Blue-chip stocks are typically companies that are leaders in their respective industries, have a strong reputation, have maintained stability throughout many years (especially during economic turmoil), and offer investors consistent growth potential.
All the stocks I choose below are within the Dow Jones Industrial Average ETF, which tracks the Dow Jones Industrial Average Index. The Dow has 30 companies within its portfolio that are all considered by most to be blue-chip companies or market leaders within their given industries. Among the stocks within the Dow Jones Industrial Average, I chose ones that have seen a considerable increase in share price over this year. And that offers investors looking for stable returns some great picks.
Salesforce (CRM)
Salesforce (NYSE:CRM) is located in San Francisco, CA, and is a consumer relationship company that stores sales data, provides customer insights and other customer service analytics. Salesforce also uses generative AI models primarily to predict consumer trends. Their list of products includes Tableau, which is an AI analytics application; Slack, a product platform for increased workflow efficiency; and MuleSoft, a customer analysis platform. They are the largest generative AI customer relationship company.
Year-to-date, Salesforce has seen an 86% increase in their share price due to positive earnings results as of recently and the increased investor excitement surrounding generative AI companies. On Nov. 29, they released their earnings for the third quarter of fiscal year 2024, which showed an 11% increase in total revenue, and their net income rose nearly six-fold compared to the previous year. Salesforce also raised its operating margins guidance for the remainder of this year. Following this earnings release, their share price grew by nearly 10%.
Visa (V)
Visa (NYSE:V) is a payment processing company that offers prepaid, credit, and debit cards. They also provide card benefit services, mobile pay capabilities, fraud protection, as well as B2B connections.
On Oct. 24, Visa announced its fiscal fourth quarter full year 2023 financial results. It stated that total revenue rose by 11%, and their net income increased by 19% compared to the year before. Their reported processed transactions increased by 10% within the same time period.
Over the past year, their share price has grown by 22% from increased earrings and payment volumes. They also authorized $5 billion in share buybacks as of the fourth quarter of fiscal year 2023.
Microsoft (MSFT)
Microsoft (NASDAQ:MSFT) is a software application company that provides cloud-based services and generative AI capabilities through Azure, Microsoft 365, which is their subscription platform composed of Microsoft Powerpoint, Microsoft Word, Microsoft Excel and other Microsoft services. They also own and operate LinkedIn, a professional job search and B2B platform, and Microsoft Bing, a search engine.
Year-to-date, Microsoft’s share price has surged by 56%. On Oct. 24, they released their first quarter fiscal year 2024, in which their total revenue increased by 13% and net income grew by 27% compared to the previous year. Microsoft’s dynamic products segment grew by 24%, its cloud services rose by 29%, and its devices segment fell by 22% compared to the previous year.
Last month, the CEO of OpenAI, Sam Altman, was removed from his position following a decision by their board of directors. Microsoft, among other companies within the generative AI field, jumped at the chance to hire him. However, only several days later, OpenAI rehired Sam Altman. Antitrust scrutiny surrounding Microsoft’s voting rights within OpenAI, to which they are a large contributor, has led to investors’ concerns regarding the potential fallout for Microsoft.
As of this writing, Noah Bolton did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
