Blue chip stocks are some of the best assets in the stock market. “Blue chip” means well-recognized, respected or established companies that are sought after for reliable growth, consistent returns and stable businesses. Their weight and presence are so impactful that major indices and investors use them as a barometer for the stock market’s overall performance.

Here’s the catch, though: blue chips aren’t usually cheap. Their mature businesses and often worldwide presence mean that every investor and their grandma knows about them. That means increased trade volumes, low volatility and high valuations. That doesn’t mean you can’t find cheap blue chip stocks. 

Sometimes, companies are eclipsed by market trends, even if they’re doing exceptionally well. So, today, let’s look at cheap blue chip stocks in the market. 

To get this list, I screened the stock market using the following criteria: 

• Belongs to either the S&P500, Nasdaq 100 or Dow Jones Index,
• Market cap of $100 billion or more,
• “Buy” to “strong buy” rating from analysts.

I then sorted the list from highest to lowest based on their potential upside based on analysts’ high price targets. Since I will be holding on to them longer, I should at least be compensated well for the length of my holding period. 

PDD Holdings (PDD)

One of the largest e-commerce companies in China, PDD Holdings (NASDAQ:PDD) is a multinational commerce company that operates a list of businesses that focus on the digital economy. The company currently has a market cap of $188 billion. 

PDD operates Pinduoduo, an e-commerce site strategically focusing on high-turnover products like farm or supplier-direct items and groceries. The company’s subsidiary Temu has also started to gain traction and has opened the doors for the company to cater to the U.S. market.

PDD Holdings had an exceptional first quarter of 2024, as revenue soared 131% year over year, driven by its online marketing and transaction services. Operating profit also experienced a 275% growth. Meanwhile, net income attributable to ordinary shareholders increased by 246%.

PDD Holdings successfully executed its high-quality development strategy, robust investment in key growth areas and commitment to long-term value creation. Wall Street also has high hopes for PDD stock, with a 93% potential upside and a strong buy. So, checking out PDD might not be a terrible idea if you want to tap into China’s gargantuan e-commerce market. 

Micron Technology (MU)

As the market continues to embrace the possibilities presented by AI, the need for GPUs, CPUs and memory chips has never been crucial. That is why Micron Technology (NASDAQ:MU) has been experiencing a surge in performance. Even with a market cap of $148 billion, this tech giant still offers room for growth. 

The company’s HBM3E memory, which offers lightning-fast data access of 1.2 terabytes per second bandwidth at a 30% lower power consumption, has been selling light hotcakes and is one of its best products that help accelerate the adoption of AI.

AI’s continuous demand supercharged Micron’s Q3’24 performance. Revenue is up from $3.75 billion to $6.81 billion, nearly double YOY. Gross margins also went green compared to the same period last year. Even more impressive, net income came in at $332 million, a turnaround from last year’s $1.9 billion loss. 

CEO Sanjay Mehrotra highlighted the company’s strong position in high-margin products and record data center SSD revenue, underscoring the strength of its AI product portfolio. 

Unsurprisingly, Wall Street rates MU stock as a strong buy with a potential upside of 73%, making Micron one of the cheapest blue chip stocks today.

Nike (NKE)

With a market cap of $109 billion, Nike (NYSE:NKE) is one of the top brands in athletic footwear, a household name and synonymous with “sneaker culture.”

While Nike may be famous for its footwear, it is also a global leader in athletic equipment and sports apparel. The company has been facing internal and external challenges, which has put it on a downtrend for a while. However, we may see some light at the end of the tunnel.

Some analysts have changed their outlook on Nike, particularly Oppenheimer, which has raised its outlook from “Perform” to “Outperform.” Oppenheimer views NKE stock as “largely derisked” and on the road to recovery. 

Nike’s FY’24 report indicated a 1% revenue growth year over year, while earnings grew 15%. According to the company, strategic pricing, lower logistics costs and effective expense management contributed to these gains. 

NKE stock has a buy recommendation based on 33 analysts and a 65% potential upside in the next 12 months based on high target prices. As one of the best cheap blue-chip stocks showing signs of recovery, this may be a chance for investors to get in while NKE is at attractive levels.

On the date of publication, Rick Orford 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.

On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.