10 Best Blue-Chip Stocks to Buy for the Long Term

Given also its inconsistent business performance, the dividend sustainability is questionable. Cellular results in an extremely volatile and unreliable performance. The company has grown fast in some years but it has greatly decelerated in the last two years. It incurred losses last year and is poised to incur further losses this year. Fulton Financial Corporation is a U.S.-based diversified financial services company with over $27 billion in assets and more than 200 branches across Pennsylvania, Maryland, Delaware, New Jersey, and Virginia. Washington Federal, Inc. is the parent company of Washington Federal, a national bank that runs more than 200 offices across eight states, primarily in the West of the United States.

• As long as you know the risks and what you are buying, they may even make a great addition during a market downturn.
• We fact-check every single statistic, quote and fact using trusted primary resources to make sure the information we provide is correct.
• What it lacks in high-octane growth, it more than makes up for in profitability.
• The semiconductor industry, like most of the technology sector, was hit hard during the chip shortage of 2022, but it has bounced back strongly in 2023.
• Advanced Micro Devices develops technology for computing, graphics and visualization for individuals, businesses and scientific research institutions worldwide.

But in the long run, they are likely to experience a full recovery and provide long-term investors with positive returns. There were major market downturns in the United States in 2000, 2007, 2008, 2010, 2011, 2015, and many other times. Two companies to watch for signals about PCs and the rest of the market are Texas Instruments and Intel, Citi Research analyst Christopher Danley wrote in a recent note.

What Are Blue-Chip Stocks?

In the world of investing, discernment is vital, especially in a market that teeters between conviction and indecision. Amidst this ebb and flow, it’s imperative to consider the top blue-chip stocks to buy. These stocks are sturdy pillars supporting the business landscape’s most influential and relevant names. However, it’s important to consider that not all blue-chip stocks are created equal. Lastly, the Morningstar Capital Allocation Rating is an assessment of how well a company manages its balance sheet investments and shareholders’ distributions. Analysts assign each company one of three ratings—exemplary, standard, or poor—based on their assessments of how well a management team provides shareholder returns.

Estimates have been cut for the company, in some cases by as much as 95%, as demand for memory products dries up, especially in consumer electronics areas like smartphones. However, it’s likely that inventories are working their way through both the PC and smartphone markets, with customers getting closer to making more purchases. The semiconductor sector has had a dreadful 2022, with the Philadelphia Semiconductor Index down nearly 40% from its 52-week high. The company has a stellar earnings track record, exceeding earnings and revenue expectations in six consecutive quarters.

Earnings Outlook

Its free cash flow (cash from operations less capital expenditures) arrived at $925.9 million. 2022 was certainly been one of the most difficult years for semiconductor stocks in recent memory. But for intrepid investors, it may represent what history will show was one of the greatest buying opportunities ever. Take for instance the Biden administration’s tech war against China, which restricts the country from buying advanced chips and equipment from the U.S. Further, China’s COVID-related lockdowns in key cities where chipmaking factories reside added strain to an already disrupted supply chain. And when those logistics issues began to ease, demand for chips which peaked during the pandemic had also started to decline.

In fact, most blue-chip companies have survived many market downturns. Blue-chip company leaders know how to manage even the most challenging circumstances. Muse recently wrote that investors are waiting for chip executives to predict that supply is going to overtake demand and cut their forecasts.

Don’t Overlook These 2 Top-Rated Stocks Before Earnings It’s Time to Buy

Despite significant turbulence in the semiconductor business, global sales reached an all-time high last year. Therefore, investors looking to buy quality chip stocks could now consider investing in United Microelectronics (UMC) and Photronics (PLAB), which look undervalued at their current prices. After building the watchlist, do some more research and decide which blue chip stocks are right for you, such as reviewing the fundamentals of each stock you’re considering, such as cash flow and return on assets. Investors can add new stocks they find or become interested in and also cut out any that don’t maximize the portfolios’ goals.

That should flow through the whole tech industry, resulting in more sales for the giants like Microsoft. Between Windows, Office and its cloud business, Microsoft is an indispensable part of the technology ecosystem. The company has operations in dozens of countries, meaning that it gets benefits from revenues in dozens of different currencies, while having natural smoothing of results among the various regions where it operates. McDonald’s also owns a ton of the real estate lying under its restaurants. McDonald’s real estate assets gain in value while competitors have to pay higher rents on their leased buildings. McDonald’s shares aren’t particularly cheap today, but earnings should improve once commodity prices such as beef start to normalize.

How Do I Invest in Blue Chip Stocks?

If you’re looking for a long-term play on microchip expansion, Taiwan Semiconductor is a good place to start. As a manufacturing giant, Taiwan Semiconductor would normally be considered a highly cyclical stock. Many manufacturers, including fellow chip fabs, are prone to ebbs and flows in sales from year to year. But Taiwan Semiconductor’s constant investment in new and advanced production has kept demand steadily rising for years. Over the past decade, the chipmaking giant has gone from just $17 billion in annual sales to almost $76 billion (through the 12 months ended in March 2023). Nvidia GPUs are 20 to 25 times more efficient than CPU servers for AI workloads.

In a strategic move, Shopify has chosen to pivot away from logistics focusing on its strength, its software-as-a-service offerings. Therefore, all signs indicate that Shopify is set to continue being the go-to solution, powering businesses https://forexarticles.net/cdn-cgi/l/email-protection of all sizes. Additionally, the introduction of high-NA EUV technology in the middle of the decade will add another leg to the growth opportunity. In an increasingly AI era, the company’s FPGA innovation should see it benefit.”