When exploring options for top blue-chip stocks to buy, investors are drawn to the perfect blend of stability and growth offered by these reliable equities. Investors often gravitate toward blue-chip stocks when they don’t want to take as many risks. These stocks keep pace with the market and have the potential to outperform, making them an attractive choice for savvy investors.
Against the dynamic backdrop of a surging S&P 500, investors discover plentiful opportunities to explore diverse investment arenas that promise robust growth and prosperity. Blue-chip stocks, celebrated for their tenacity, gain additional allure amid the uncertainties of impending national elections. Positioned as more secure investments than their smaller counterparts, these stocks provide a refuge for investors to broaden their portfolios and skillfully maneuver through potential market turbulence with assurance.
In this strategic investment context, the following three blue-chip stocks emerge as compelling options for astute investors eyeing steady, long-term returns.
Johnson and Johnson (JNJ)
Pharmaceutical titan Johnson & Johnson (NYSE:JNJ) has effectively recently refined its focus, thanks to the strategic spin-off of its consumer products division Kenvue (NYSE:KVUE). The $36 billion deal allowed JNJ to channel its vast expertise and resources more efficiently into its more lucrative segments such as medical devices, diagnostics and pharmaceutical research and development.
JNJ reported a 7.3% bump in sales in the fourth quarter (Q4) of 2023, highlighting its operational prowess. It posted a stellar $21.4 billion. Notably, its innovative medicine and medtech segments saw sales increases of 4.2% and 13%, which helped wrap up another stellar quarter of top-and-bottom-line beats.
Furthermore, JNJ is trading at roughly 15 times non-GAAP price-to-earnings (P/E) yielding a healthy 3% coming ahead of sector medians with aplomb. This financial resilience, combined with a history of over 50 years of consistent dividend payments, positions JNJ as an attractive income investment offering considerable upside.
Visa (V)
Visa (NYSE:V) is a fintech trailblazer in global transactions, exemplifying stability and long-term growth. Bolstered by unparalleled profit margins, its impressive gross profit margin for the trailing twelve months stands at an impressive 97.8%, surpassing the sector median by a remarkable 63.7%.
Moreover, this formidable performance continued into the first quarter (Q1) of 2024. The fintech titan posted a noteworthy 9% year-over-year (YOY) increase in sales and an impressive 17% surge in net income.
Additionally, Visa solidifies its stature by transitioning seamlessly to shareholder-centric strategies, including share repurchases and dividend enhancements. The firm’s proactive approach saw it allocating $3.4 billion to stock buybacks while earmarking an additional $26.4 billion for future repurchases. A dividend yield of 0.74% and a significant uptick in its quarterly dividend to $0.52 per share underscores Visa’s commitment to returning value to its investors.
Furthermore, with a forward GAAP P/E ratio of 28.5, the company’s trajectory illuminates continued innovation and financial prosperity for its stakeholders.
Chipotle Mexican Grill (CMG)
Chipotle Mexican Grill (NYSE:CMG) is going full-steam ahead with its expansion plans, as it continues to build on its niche as a heathier alternative in the fast-food sector. By leveraging its reputation for wholesome, sustainable food, the company has set ambitious targets for 2024 to open 285 to 315 new restaurants. This marks a substantial increase from the 271 restaurants added in 2023, and notable uptick at the midpoint target of 300.
Looking into Q4 financials, the fruit of this strategic expansion were evident. During this period, Chipotle recorded a remarkable 15.4% YOY bump in sales, surpassing its already impressive full-year growth of 14.3%. Additionally, Chipotle witnessed an exceptional 27.3% surge in diluted EPS.
Moreover, Chipotle’s robust financial performance fueled an impressive 79.6% stock surge in the past year, coupled with an enticing five-year gain of 340%, suggesting lucrative prospects for long-term growth.
On the date of publication, Muslim Farooque 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
