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The Stock Market Is Overbought and Insiders Are Selling: Grab These 5 High-Yield Blue Chips Now
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Investors love dividend stocks, especially the blue-chip variety, because they offer a significant income stream and have massive total return potential. Total return includes interest, capital gains, dividends, and distributions realized over time. In other words, the total return on an investment or a portfolio consists of income and stock appreciation. Blue chip stocks are shares of large, well-established companies considered less risky and more financially stable than other stocks. They are often industry leaders with strong brand names and reputations and a history of consistent growth.
24/7 Wall St. Key Points:
- The S&P 500 was up over 20% in 2023 and 2024 and was strong out of the gate in 2025.
- There hasn’t been a 10% sell-off since October of 2023.
- Insiders at big corporations have been selling hand-over-fist.
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While the past two years have been outstanding for equity investors, the reality is that stocks can’t go straight up forever. Led by a furious technology rally driven by the Magnificent 7 and massive hype over the potential for artificial intelligence changing the world, stocks made a gigantic parabolic move higher. With the S&P 500 up well over 20% for two years, a feat that hasn’t happened since the late 1990s, stocks have gotten very overbought. Toss in the fact that insiders at major U.S. corporations have been selling shares at a massive pace; it may be time to take some profits and move to safe blue-chip dividend giants.
We screened our 24/7 Wall St. blue chip dividend stock database, and five outstanding large-cap companies look like just the ticket now for worried investors. All are rated Buy at major Wall Street firms that we cover.
Why do we cover blue-chip dividend stocks?
Blue-chip dividend stocks provide investors with reliable streams of passive income. Passive income is characterized by its ability to generate revenue without requiring the earner’s continuous active effort, making it a desirable financial strategy for those seeking to diversify their income streams or achieve financial independence.
AT&T
The legacy telecommunications company has been undergoing a lengthy restructuring while lowering its dividend, which still stands at 4.90%. AT&T Inc. (NYSE: T) provides worldwide telecommunications, media, and technology services. Its Communications segment offers wireless voice and data communications services and posted outstanding fourth-quarter results.
AT&T sells through its company-owned stores, agents, and third-party retail stores:
- Handsets
- Wireless data cards
- Wireless computing devices
- Carrying cases
- Hands-free devices
AT&T also provides:
- Data
- Voice
- Security
- Cloud solutions
- Outsourcing
- Managed and professional services
- Customer premises equipment for multinational corporations, small and mid-sized businesses, and governmental and wholesale customers.
In addition, this segment offers residential customers broadband fiber and legacy telephony voice communication services.
It markets its communications services and products under:
- AT&T
- Cricket
- AT&T Prepaid
- AT&T Fiber
The company’s Latin America segment provides wireless services in Mexico and video services in Latin America. This segment markets its services and products under the AT&T and Unefon brands.
UBS has a Buy rating with a $30 target price.
Citigroup
This is a top bank that Warren Buffett bought a massive $2.5 billion worth of stock in the summer of 2022. The stock pays a dependable 2.90% dividend. Citigroup Inc. (NYSE: C) is a leading global diversified financial service company that provides consumers, corporations, and governments with a broad range of financial products and services.
Citigroup offers:
- Consumer banking and credit
- Corporate and investment banking
- Securities brokerage
- Transaction services
- Wealth management services.
Citi operates and does business in more than 160 countries/jurisdictions in North America, Latin America, Asia, Europe/Middle East and Africa (EMEA).
Trading at a reasonable 9.2 times estimated 2025 earnings, this company looks very reasonable in a volatile stock market. It is in a sector that has exploded out of the gate in 2025. Citigroup posted fourth-quarter net income of $2.86 billion, an improvement from a net loss of $1.84 billion a year ago.
BofA Securities has a Buy rating with a $95 target.
Exxon Mobil
The slow but steady increase in oil prices still offers investors an excellent entry point, and they will gladly grab a strong 3.64% dividend. Exxon Mobil Corp. (NYSE: XOM) is the world’s largest international integrated oil and gas company, exploring for and producing crude oil and natural gas in:
- The United States
- Canada
- South America
- Europe
- Africa
- Asia
- Australia/Oceania
Exxon also manufactures and markets commodity petrochemicals, including olefins, aromatics, polyethylene and polypropylene plastics, and specialty products, and transports and sells crude oil, natural gas, and petroleum products.
Top Wall Street analysts expect Exxon to remain a key beneficiary in a higher oil price environment, and most remain very optimistic about the company’s sharp positive inflection in capital allocation strategy, upstream portfolio, and leverage to further demand recovery. ExxonMobil offers greater Downstream/Chemicals exposure than its peers.
Exxon has completed its purchase of oil shale giant Pioneer Natural Resources in a $59.5 billion all-stock purchase. The deal created the largest U.S. oilfield producer and guaranteed a decade of low-cost production.
Piper Sandler has a Buy rating with a $138 price objective.
Johnson & Johnson
With a diverse product base and a familiar and solid brand, Johnson & Johnson (NYSE: JNJ) is among the most conservative big pharmaceutical companies and pays a 3.35% dividend. The company researches, develops, manufactures, and sells a range of healthcare products. Its primary focus is products related to human health and well-being.
It operates through two segments:
- Innovative Medicine
- MedTech
The Innovative Medicine segment is focused on various therapeutic areas, including:
- Immunology
- Infectious diseases
- Neuroscience
- Oncology
- Pulmonary hypertension
- Cardiovascular and metabolic diseases.
Products in this segment are distributed directly to retailers, wholesalers, distributors, hospitals, and healthcare professionals for prescription use.
The MedTech segment includes a broad portfolio of products used in orthopedics, surgery, interventional solutions, cardiovascular intervention, and vision fields. It also offers a commercially available intravascular lithotripsy (IVL) platform for coronary artery disease (CAD) and peripheral artery disease (PAD).
Citigroup has a Buy rating with a $185 target price objective.
Target
This company remains a solid and safe retail total return play despite rough public relations issues and pays a solid 2.90% dividend. Target Corp. (NYSE: TGT) is a general merchandise retailer in the United States. It offers apparel for women, men, boys, girls, toddlers, infants, and newborns, as well as jewelry, accessories, and shoes. The company also offers beauty and personal care products, baby gear, cleaning, paper, and pet supplies.
Target also provides:
- Dry grocery dairy, frozen food, beverages, candy, snacks, deli, bakery, meat, and food service
- Electronics, which includes video game hardware and software
- Toys, entertainment, sporting goods, and luggage
- Furniture, lighting, storage, kitchenware, small appliances, home décor, bed and bath
- Home Improvement
- School/office supplies
- Greeting cards, party supplies, and other seasonal merchandise
In addition, the company sells merchandise through periodic design and creative partnerships, shop-in-shop experiences, and in-store amenities. It also sells its products through its stores and digital channels, including Target.com.
The company suffered a “Bud Light” moment a few years back after the disastrous merchandising of LGBTQ products, which struck a nerve among many shoppers. While not as bad as the beer giant’s conundrum, it was a huge negative that has seemingly subsided.
Oppenheimer has an Outperform rating to go with a $165 target price.
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