February 2024 is now upon us, making it a great time to discover blue-chip stocks to generate stable, long term returns in the stock market. It is without question that market exuberance is present, as the Federal Reserve held rates steady at the FOMC meeting last week.
The market has continued to surge to new record highs, led by the mega cap technology sector. While earnings have been much greater than anticipated, FOMO should not be a driver of your long term investing decisions. There still exist blue-chip stocks that stand out as rock-solid choices with hidden value for your portfolio this month.
Now, let’s unpack the 3 best blue-chip stocks to grab in February 2024!
PepsiCo (PEP)
PepsiCo (NASDAQ:PEP) is an American multinational food and beverage company headquartered in Harrison, New York. They’re undoubtedly one of the most recognized brands in the world with an incredible track record returning cash to shareholders.
PepsiCo is unique in that they cover both manufacturing and distribution of their wide array of products. Over the last decade, the company has diversified its product portfolio which has paid dividends for the company. Furthermore, their expansion into international markets continues to be a key revenue growth driver.
Strength in Latin America continues to show promising signs as they promote cost-management initiatives. Supply chain bottlenecks are alleviating, and loosening financial conditions are bullish for increased spending in the CPG sector. PepsiCo expects 10% revenue growth and 13% EPS growth in FY23. With a demonstrated history of returning cash to shareholders, don’t leave this dividend growth stock behind in February 2024.
UnitedHealth Group (UNH)
UnitedHealth Group (NYSE:UNH) finished off a strong 2023 fiscal year driven by strong double-digit growth at Optum and UnitedHealth Care. They’re one of the largest companies in the world by revenue, and ranked 10th on the 2023 Fortune Global 500.
UnitedHealth Group is arguably one of the most impressive stories of the last decade. The stock has returned a 23.50% CAGR over the last decade, and is up 740% during the same time period. This shouldn’t surprise investors, as the company has continued to deliver strong year-over-year (YOY) growth in revenue, operating income, and EPS.
In FY23, operating income increased 13.8% YOY to $32.4 billion as diversified growth lifted all boats. EPS hit a record $25.12 per share, as the company’s strong execution allowed them to serve more customers. With the recent dip in the stock price, discerning investors will scoop up shares here for the long term.
Deere & Co. (DE)
Deere & Co. (NYSE:DE) stands out among the elite blue-chip stocks to buy for February 2024. Not only is the company incredibly cheap, they stand to benefit from the long term tailwinds of the Infrastructure Investments & Jobs Act.
Deere & Co. has traded sideways for the last several years despite the significant progress the company has made. As one of the world’s largest construction equipment manufacturers, they were inevitably impacted by supply chain constraints and higher interest rates. However, they were able to weather the storm and still deliver significant top and bottom line growth in the 2023 fiscal year.
In FY23, Deere grew its top line revenue 16.5% YOY to $61.25 billion. Net income skyrocketed 42% to $10.16 billion, or $34.63 per share. Deere has continued to grow its quarterly dividend at a high rate, most evident in its 9% hike to a record $1.47 per share. While earnings are forecasted to decline to mid-cycle levels in FY24, cheap blue-chip stocks leave a compelling opportunity for long term investors.
On the date of publication, Terel Miles did not have (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.
