If your blue-chip stocks are underperforming, you have a big problem. Blue-chip stocks represent the best, most stable companies and can usually be considered solid performers. There are plenty of good names out there, so there’s no need to holding battered blue-chip stocks.
Even with some recent pullbacks, the S&P 500 and the tech-heavy Nasdaq composite are up 5% on the year. But the Dow Jones Industrial Average, which is comprised of 30 of the most prominent companies, is faltering. Its gains for the year are negligible at best.
Blue-chip stocks represent established companies that are leaders in their field. They often pay reliable dividends and are considered safe for long-term investors.
But you aren’t getting those generous returns from the blue-chip stocks on this list. For various reasons, these battered blue-chip stocks are taking it on the chin right now, and threatening to pull portfolios down with them.
The Portfolio Grader is an ideal tool for identifying blue-chip stocks that aren’t making the grade. The Portfolio Grader evaluates stocks based on earnings performance, growth, analyst sentiment and momentum, and assigns an “A” through “F” grade accordingly.
These blue-chip names are among the worst to have now. Act accordingly if you’re holding any of these equities.
Apple (AAPL)
It wasn’t too long ago that Apple (NASDAQ:AAPL) was the biggest company in the world by market capitalization. It was revered for innovative products, had a huge base of customers and was seemingly unlimited potential.
What in the heck happened to push AAPL to the ranks of battered blue-chip stocks?
But the shine on this Apple faded a bit last year, as iPhone sales slipped and earnings flattened. Apple saw drops in multiple products, including to Macs, home products, iPads and wearable technology.
It doesn’t help that Apple is facing huge challenges in China, where iPhone sales are down 24% in the first few weeks of the year, in part because competitor Huawei is now offering its own 5G smartphone.
Apple is also battling both the U.K. and U.S. on the legal front, with allegations that Apple’s App Store unfairly stymies competition.
Apple is still a great company. But as an investment, it’s best to leave it on the tree. AAPL stock is down 13% in 2024 and gets a “D” rating in the Portfolio Grader.
Tesla (TSLA)
Electric vehicle maker Tesla (NASDAQ:TLSA) was on a dynamic run at the beginning of the decade, rising over 1,000% in a two-year span from January 2020 to December 2021. Since then? A huge disappointment.
There are a couple of factors at play. First, Tesla dominated the EV market in that two-year period, but naturally, other car manufacturers began entering the market and giving Tesla competition. Tesla responded by lowering the prices on some of its models to spur sales, and in turn cutting its own profit margin.
The second issue is Tesla CEO and founder Elon Musk. Tesla’s slip in stock price corresponds to his $44 billion purchase of the social media platform Twitter, which he rebranded to X. Musk sold billions of dollars in Tesla stock to finance the deal.
An activist at heart, Musk eagerly uses X as a platform to espouse controversial views and stir the pot. The drama makes Tesla a less appealing brand to would-be customers who don’t want to be seen as endorsing Musk’s brand of politics.
Tesla will report its first-quarter earnings on April 23 and analysts are already bracing for bad news. TSLA stock is down 37% in 2024 and gets a “D” rating in the Portfolio Grader.
Intel (INTC)
Semiconductor chip maker Intel (NYSE:INTC) is facing some challenges. While its stock flails in 2024, bigger and better-heeled competitors are soaring on the power of generative AI chips, and in turn helping investors in those companies make money hand over fist.
So, it’s no surprise that tech stock investors are turning away from Intel.
The company’s foundry division posted a loss of $7 billion in 2023 as it attempts to compete with Taiwan Semiconductor (NASDAQ:TSM), which already has the lion’s share of the foundry market.
Intel is still investing in the business, pouring billions of dollars into increasing capacity. It currently has a 1% market share in the foundry business, but hopes to be No. 2 in the world and start turning a profit by 2030 (TSMC has the top spot locked up with a 58% market share).
I don’t know about you, but that’s a long time to ask investors to wait for foundry profits. INTC stock is down 29% this year and gets a “C” rating in the Portfolio Grader.
PayPal (PYPL)
PayPal (NASDAQ:PYPL) is a fintech stock that may have ahead of its time. The stock rose 170% from January 2020 to July 2021, the Covid-19 shutdown era in which e-commerce was pretty much the only way to buy and sell products.
It’s hard to believe that PayPal stock once topped $300. Now it could be had for less than $70. And while the company offers an impressive array of brands, including Zettle, Xoom, Venmo, Honey and Hyperwallet, there’s massive competition in the fintech space.
The number of active users fell from 435 million in 2022 to 431 million in 2023. If PayPal is going to turn around its slide, it will need to find a way to reverse that trend.
PYPL stock is up 3% so far in 2024 and gets a “D” rating in the Portfolio Grader.
Ford Motor Co. (F)
Ford Motor Co. (NYSE:F) is one of the best-known brands in the world. As an automaker, Ford makes the F-150 pickup, the Explorer SUV and the sporty Mustang. It’s one of the Big Three Detroit automakers.
It’s been a challenge in recent months, however. Competition is always fierce, and Tesla’s move to lower its EV prices has a ripple effect for other automakers that Ford can’t ignore.
Ford also was one of three automakers that experienced a strike last year, and was forced to make significant wage concessions to get union members back on the job.
Ford saw an 81% jump in its EV sales in February, and overall sales increase by 6.8% in the first quarter. It remains to be seen how the company’s profit margins will hold, however, and how investors will react when it reports first-quarter earnings on April 24.
F stock is down 1% in 2024 and gets a “D” rating in the Portfolio Grader.
Boeing (BA)
Boeing (NYSE:BA) is a nightmare stock to own right now. The aerospace and defense contractor is under serious pressure as a series of problems with its aircraft left investors reeling.
First, a rear door plug flew off a Boeing 737 Max 9 passenger jet in mid-flight. The Federal Aviation Administration grounded Boeing 737 Max 9 jets for inspection, and two airlines reported finding loose screws on their aircraft.
The FAA allowed the Max 9 to resume flying a few weeks later, but many passengers remain reluctant. The FAA and the National Transportation Safety Board both issued critical reports of Boeing as well.
So unsurprisingly, Boeing stock is one of the worst performers of the Dow Jones Industrial Average in 2024, down 34%.
It’s going to be a rough period for Boeing in 2024 and there’s no need to try to catch a falling knife. BA stock has an “F” rating in the Portfolio Grader.
Starbucks (SBUX)
Starbucks (NASDAQ:SBUX) grew mightily from its roots in Seattle to be a dominant brand around the world. Starbucks has more than 39,000 locations, with plans to increase that to 55,000 by the end of the decade.
However, the stock is trading near its 52-week lows as customer traffic fell in the U.S. and China. Embattled Luckin Coffee (OTCMTKS:LKNCY) surpassed Starbucks as China’s No. 1 coffeehouse with an aggressive expansion and pricing plan that undercuts Starbucks.
Starbucks saw its international store count and international revenue grow by 10% in 2023 – but operating margins slipped, and the company’s operating income remained flat for the year despite the expansion.
The company will need to find a way to turn its fortunes in China around without shaving off too much in margin and profitability. SBUX stock is down 10% in 2024 and gets an “F” rating in the Portfolio Grader.
On the date of publication, Louis Navellier did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The InvestorPlace Research Staff member primarily responsible for this article held AAPL, but did not hold (either directly or indirectly) any other positions in the securities mentioned in this article.
