Blue stocks with reliable dividends – Magic Post

With investment themes like cryptocurrency adoption, sending rockets to Mars, and using artificial intelligence to find cures for some of the world’s most exciting diseases, the idea of ​​investing in blue-chip stocks may seem boring. But boring stocks can be beautiful for your portfolio.

Blue chip companies are known to be at a mature stage in their business cycle. They’re not companies you expect to be turbulent. Their innovation comes largely through acquiring smaller companies.

But what these companies may lack in supplies, they provide in basics. Investing in blue stocks means that you are investing in companies with a strong balance sheet underpinned by consistent revenues and profits. In many cases, these companies reward shareholders with stock buybacks and by paying out a portion of those profits via dividends.

These are all reasons why blue chip stocks are often referred to as “sleeping well at night.” Because you have confidence that these stocks will be around for a long time, you don’t have to be concerned about sharp short-term moves in one direction or another.

If these sound like the stocks you’re looking for during this recent period of market volatility, here are three blue-chip dividend stocks that offer investors future growth as well as attractive value.

Coca-Cola shows beauty is in the eye of the beholder

Coca Cola Company New York: CoIt is a popular blue-chip stock that many investors recognize as a favorite of Warren Buffett. But is that enough to believe that this dividend king can provide a jolt to your buy-and-celebrate portfolio?

On one hand, you could say the company is finding growth difficult. Despite moving into new categories, such as energy drinks, the company is having trouble improving its top line. This means that the company’s earnings growth has come from higher prices, not higher volumes.

However, if you take the long view and look at stocks that could outperform the broader market, KO stock is still attractive. Over the past five years, the stock has generated a total return of 24.24%. Not only is this sector up 14%, but it also beats the S&P 500’s total return, which is 14.87% over the same period. As part of this total return, you receive dividends with a yield of 3.15% as of this writing.

General Dynamics is not your average defense contractor

Many investors expect space stocks like General Dynamics Corp. NYSE:GD To rocket higher with Trump 2.0 in place. But this was not the case, due to Musk’s first friend, Elon Musk’s Doug Committee, which He is tasked with communicating government waste and inefficiency.

As one of the most important items in the federal budget, defense spending appears to be a major target. Time will tell. But even if that’s the case, General Dynamics appears to be in a safe place.

First of all, there will always be a market for the need for the physical weapons provided by the company, such as the Abrams tank. Second, General Dynamics was awarded a $922 million contract to upgrade the IT infrastructure at US Central Command (Centcom) in February 2024. Part of this contract will include the company’s Luna AI system, which is specifically designed for government and defense applications.

This means you can look beyond the short term and consider a stock that has delivered a total return of over 64% in the last five years. Additionally, at 19X forward, GD stock is trading about 27x below the sector average.

ExxonMobil will do well even if oil prices don’t

Investors are starting to think about what “baby drill, drill” really means for oil prices. Simply put, the more oil companies like Exxon Mobil Company NYSE:XOM production, the price of oil fell. That will mean lower profits for oil companies and, most likely, lower stock prices.

Oil companies are used to the dance of supply and demand, and steps have been taken to ensure they are not over-smoothed. The company laid out a corporate plan in December that includes everything investors need to know, including earnings and cash flow projections, capital return programs, and cost-savings targets. In fact, the company, which already has a break-even level with oil around $50 a barrel, is making plans to be profitable even with oil near $30 a barrel.

This means you can look beyond the headlines and appreciate value in XOM stock, which trades for about 14x forward earnings and has paid a dividend that has increased for 24 consecutive years.