RBC Says to Stay Long the Market: These 4 Top Blue Chips Look Good

If one thing is clearly evident on Wall Street this year, it is that there is some very divergent thought among the major firms we cover. Some are still very bearish and suggest selling every rally immediately. Others are far more positive and point to the solid economic news that continues to come out week after week. With the dollar’s strength abating and the economy growing, one firm we cover is very positive on the current market.

A new report from Robert Sluymer and his outstanding team at RBC makes the case that history tells us that declines in secular bull markets like we have seen twice in the past nine months are shallow, and the rebounds are often very powerful and sustained. The RBC report points to numerous sectors and the stocks that looked good. We found four large cap, blue chip companies that look outstanding now. They combine solid fundamentals with outstanding technical patterns.

Coca-Cola

This remains a top Warren Buffet holding and offers not only safety but also an incredible strong worldwide brand. Coca-Cola Co. (NYSE: KO) is the world’s largest beverage company, refreshing consumers with more than 500 sparkling and still brands. Globally, it is the top provider of sparkling beverages, ready-to-drink coffees and juices and juice drinks. Through the world’s largest beverage distribution system, consumers in more than 200 countries enjoy its beverages at a rate of more than 1.9 billion servings a day.

Led by Coca-Cola, one of the world’s most valuable and recognizable brands, the company’s portfolio features 20 billion-dollar brands including Diet Coke, Fanta, Sprite, Coca-Cola Zero, vitaminwater, Powerade, Minute Maid, Simply, Georgia and Del Valle.

The still strong U.S. dollar could continue to be a headwind to the international business, but the company has expanded the product lines, and it posted fourth-quarter earnings that top Wall Street analysts were very encouraged by.

Coca-Cola investors are paid an outstanding 3.01% dividend. The Thomson/First Call consensus price target is posted at $46.91. The stock closed Tuesday at $46.50 per share.
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General Electric

This iconic blue chip has been on a strong roll, and investors may want to scale buy shares looking for a pullback. General Electric Co. (NYSE: GE) is a highly diversified, global industrial corporation. Its businesses are organized broadly under six segments: GE Capital, Energy Infrastructure, Aviation, Healthcare, Transportation and Home & Business Solutions.

The company’s products and services include power generation equipment, aircraft engines, locomotives, medical equipment, appliances, commercial leasing and personal finance. Top Wall Street analysts feel that the American giant will be a large player in the efficient energy field.

The company is in the middle of a huge plan that is scaling back many of its operations and returning capital to shareholders. GE announced a restructuring plan last year that includes buying back up to $50 billion of its shares, selling about $30 billion in real estate assets over the next two years and divesting more GE Capital operations. The continued restructuring and sale of the appliance division provides some cushion to earnings estimates

The company posted solid fourth-quarter numbers, despite being somewhat hampered by slower organic growth. GE does an estimated 52.9% of its total sales overseas, so a weaker dollar surely could help.

General Electric investors are paid a solid 2.92% dividend. The consensus price objective is $32.69. Shares closed most recently at $31.48.
3M

This is a top industrial that could really jump with an economic pickup. 3M Co. (NYSE: MMM) is a diversified, global manufacturer. Its businesses are technology-driven and organized under five segments: Consumer, Safety and Graphics, Electronics and Energy, Healthcare, and Industrial. Its popular brands include Scotch, Post-It, 3M and Thinsulate. The company also holds over 500 U.S. patents.

The company crushed earnings expectations for the fourth quarter and rallied huge. Top Wall Street analysts commented that the execution at the company remains outstanding, and there was strength in consumer and health care across all of the company’s regions. With margins expanding this remains an outstanding stock to own.

We recently covered the highlights of the company’s analysts day, from which many on Wall Street came away with renewed confidence in the blue chip stalwart. The stock has had a huge run, so there may have been some sell-the-news action.

3M investors are paid a 2.7% dividend. While the consensus price target is at $158.31, the stock closed most recently way above that at $164.39 per share.

Molson Coors

This is another consumer stock that has acted very well recently. Molson Coors Brewing Co. (NYSE: TAP) is a leading global brewer that brews, markets and sells a portfolio of leading premium brands, such as Coors Light, Molson Canadian, Carling, Staropramen and Blue Moon, across North and South America, Europe and Asia.

The company operates in Canada through Molson Coors Canada; in the United States through MillerCoors; across Europe through Molson Coors Europe; and outside these core markets through Molson Coors International. The company is the only alcohol producer currently recognized for world-class sustainability performance through the Dow Jones Sustainability Index.

With the giant brewers joining forces, Molson Coors remains a formidable challenger to the other mega-brewers, and it should continue to be a strong product favorite among consumers.

Investors in Molson Coors are paid a 1.71% dividend. The consensus price target for the stock is $105. The shares closed most recently at $96.11 apiece.
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The U.S. market and economy remains one of the best places for investors to put their money. These top companies all make very good sense for growth and income portfolios.