Wagering on the top blue-chip stocks to buy on the dip might be the best way to play the current stock market trends.
Blue-chip stocks typically offer a superb blend of reliability and growth potential,
making them no-brainer bets for the long haul. Moreover, these stocks have
become household names with underlying businesses that have stood the test of time. Additionally, their outperformance is shown by the Fidelity Blue Chip Growth ETF (NYSEMKT:FBCG) which has grown over 35% in the past three years, outperforming other median exchange-traded funds (ETF) by 464%.
That said, here are three blue-chip stocks to buy, offering an opportunity
to capitalize on their competitive advantages and excellent track records.
Also, these stocks have been consistent over the years in ploughing back
profits to expand their revenue base and reward shareholders in the process.
Moreover, Blue-chip companies continue to prioritize their shareholders, offering growing
dividend payouts with attractive yields. Though these three blue-chip stocks
have dipped of late, they’re positioned to deliver robust long-term growth ahead.
Pfizer (PFE)
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Pfizer(NYSE:PFE) is a true giant in the pharmaceutical industry, currently trading at a highly attractive valuation following a major correction. PFE stock has lost upwards of 28% in the past year following the slowdown in COVID-19 vaccine sales. However, Pfizer senses the urgency to actively tackle the challenge head-on.
The firm boasts a powerful pipeline with 113 drug candidates, 37 of which are in phase three trials, signalling a clear pathway for drug commercialization. Further bolstering its prospects, the pharma giant made a strategic $43 billion acquisition of Seagen in December, furthering its footprint in the oncology space.
Additionally, with a rich history of dividend payments stretching over eight decades, Pfizer has established its position as one of the go-to income stocks in its niche. Also, it yields upwards of 6%, substantially higher than many peers, while trading at just 2.60 times forward sales, 22% lower than its 5-year average.
American Express (AXP)
American Express(NYSE:AXP)is a leading undervalued blue-chip stock, which presents itself as a compelling buy-the-dip opportunity. Known for its resilience, American Express has grown its top and bottom line at a tremendous pace, underpinned by its diversified income streams. These powerful elements have contributed significantly to its financial ability, making it a highly attractive pick compared to its peers.
Furthermore, the firm has tailored its approach to resonate with millennials and Gen Z, adding a new dimension to its timeless product suite. Also, despite record-high interest rates, credit card and consumer spending remains excellent through American Express.
Moreover, American Express reported a stellar 11% increase in year-over-year (YOY) revenues in Q1. Likewise, its net income jumped 34%, achieving a 16.9% net profit margin. Additionally, the firm is known for its stellar shareholder returns, having bumped its dividend by 17%, with payouts growing 10% or more annually. Moreover, American Express is well-positioned for long-term growth and to continue delivering shareholder rewards with a current yield of over 1.22% and trading at 2.49 times forward sales.
Hershey (HSY)
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Hershey(NYSE:HSY) is a global confectionery leader and one of the most consistent businesses in its niche. Housing some of the most popular confectionary brands, the firm’s revenues and EBITDA have grown over 7.55% and 8.9%, respectively, in the past five years. Recent results have also been impressive despite the inflationary headwinds in play.
It recently surpassed earnings and revenue expectations in Q1, fueled by Easter and Valentine’s Day seasonal boosts. Hershey’s chocolate products saw stronger shelf turnover complemented by its pricing power. Also, this momentum will continue growing as its management projects a considerable uptick in volume trends for the remainder of the year.
Furthermore, investors’ confidence in Hershey is solidified by its reliable dividends, yielding north of 3%, and its massive cash flow base, which exceeds $712 million. This commitment to returning value to shareholders and consistent sales growth driven by strategic regional pricing positions Hershey for long-term success.
On thedate of publication, Muslim Farooque did not have (eitherdirectly 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.comPublishing Guidelines.
Muslim Farooque is a keen investor and an optimist at heart. A life-long gamer and tech enthusiast, he has a particular affinity for analyzing technology stocks. Muslim holds a bachelor’s of science degree in applied accounting from Oxford Brookes University.
Blue-Chip Stocks, Dividend Stocks
