The trend is your friend is a well-known Wall Street catchphrase that often has proven to be correct. Depending on the nature of the trend, it is frequently used to buy and sell stocks, adjust stock sector allocations, and in numerous other ways where capturing and riding a trend is a smart way to manage your money.
One trend that is not always accurate is that when stocks hit 52-week lows, it typically indicates that the shares will continue to trade lower, as that is the trend. However, as we have pointed out over the years, some of the biggest and most successful companies in the world, including Amazon, Apple, and even Nvidia, whose shares have skyrocketed, have traded in the single digits. When all those companies were trading below $10, they were at 52-week lows at some point.
Blue-chip stocks are shares of large, well-established companies that are financially stable and have a history of consistent and reliable performance. They are often considered less risky and are a popular choice for long-term investors. Additionally, nearly all leaders in the category pay dependable, recurring dividends each quarter, regardless of the state of the economy. The term “blue chip” originates from the game of poker, where a blue chip holds the highest value.
When you can add quality blue-chip stocks trading at the lowest level in a year or more, you may have stumbled onto a total return home run. We screened the S&P 500, looking for quality stocks at or near their 52-week lows, and found four companies with stellar dividends that could be massive bargains. All are rated Buy by the top Wall Street firms we cover, and all are suitable for investors with a higher risk tolerance.
Why do we cover blue-chip dividend stocks?
Since 1926, dividends have contributed approximately 32% of the total return for the S&P 500, while capital appreciations have contributed 68%. Therefore, sustainable dividend income and capital appreciation potential are essential for total return expectations. A study by Hartford Funds, in collaboration with Ned Davis Research, found that dividend stocks delivered an annualized return of 9.18% over the 50 years from 1973 to 2023. Over the same timeline, this was more than double the annualized return for non-payers (3.95%).
Dow
Dow Inc. (NYSE: DOW | DOW Price Prediction) serves as a holding company for The Dow Chemical Company and its subsidiaries.
The Company conducts its operations through six global businesses, which are organized into segments, including:
- Packaging & Specialty Plastics
- Industrial Intermediates & Infrastructure
- Performance Materials & Coatings
Packaging & Specialty Plastics segment consists of two integrated global businesses: Hydrocarbons & Energy and Packaging and Specialty Plastics. This segment employs a polyolefin product portfolio.
The Industrial Intermediates & Infrastructure segment comprises two customer-centric global businesses: Industrial Solutions and Polyurethanes & Construction Chemicals. These businesses develop intermediate chemicals essential to manufacturing processes, as well as downstream, customized materials and formulations that utilize advanced development technologies.
Performance Materials & Coatings segment consists of two global businesses: Coatings & Performance Monomers and Consumer Solutions. Less
Wells Fargo has an Overweight rating with a target price of $40.
PepsiCo
This worldwide food and beverage company posted solid fourth-quarter earnings and will continue to supply all the goods for summer tailgates and parties. PepsiCo Inc. (NYSE: PEP) is a top consumer staples stock.
Its Frito-Lay North America segment offers:
- Lays and Ruffles potato chips
- Doritos, Tostitos, and Santitas tortilla chips
- Cheetos cheese-flavored snacks, branded dips
- Fritos corn chips
The company’s Quaker Foods North America segment provides:
- Quaker Oatmeal
- Grits
- Rice cakes
- Natural granola and oat squares
- Pearl Milling mixes and syrups
- Quaker Chewy granola bars
- Cap’n Crunch cereal
- Life cereal
- Rice-A-Roni side dishes
PepsiCo’s North America Beverages segment offers beverage concentrates, fountain syrups, and finished goods under these brands:
- Pepsi
- Gatorade
- Mountain Dew
- Diet Pepsi
- Aquafina
- Diet Mountain Dew
- Tropicana Pure Premium
- Sierra Mist
- Mug brands
Citigroup has a Buy rating with a $170 price target.
Pfizer
Established in 1849 in New York by two German entrepreneurs, this top pharmaceutical stock was a massive winner in the COVID-19 vaccine sweepstakes, but it has struggled over the past two years as many people are not getting boosters. Pfizer Inc. (NYSE: PFE) discovers, develops, manufactures, markets, distributes, and sells biopharmaceutical products worldwide.
The company offers medicines and vaccines in various therapeutic areas, including:
- Cardiovascular metabolic and women’s health under the Premarin family and Eliquis brands
- Biologics, small molecules, immunotherapies, and biosimilars under the Ibrance, Xtandi, Sutent, Inlyta, Retacrit, Lorbrena, and Braftovi brands
- Sterile injectable and anti-infective medicines and oral COVID-19 treatment under the Sulperazon, Medrol, Zavicefta, Zithromax, Vfend, Panzyga, and Paxlovid brands.
Pfizer also provides medicines and vaccines in various therapeutic areas, such as:
- Pneumococcal disease, meningococcal disease, tick-borne encephalitis
- COVID-19 under the Comirnaty/BNT162b2, Nimenrix, FSME/IMMUN-TicoVac, Trumenba, and the Prevnar family brands
- Biosimilars for chronic immune and inflammatory diseases under the Xeljanz, Enbrel, Inflectra, Eucrisa/Staquis, and Cibinqo brands
- Amyloidosis, hemophilia, and endocrine diseases under the Vyndaqel/Vyndamax, BeneFIX, and Genotropin brands
Pfizer recently increased its quarterly dividend to $0.43 per share, a 2.4% increase from the previous dividend of $0.42. This marks the company’s 345th consecutive quarterly dividend payment and 15th year of dividend growth.
Truist Financial has a Buy rating with a $32 target price objective.
UPS
United Parcel Service Inc. (NYSE: UPS) is an American multinational shipping and receiving and supply chain management company. With the explosion of internet commerce, this company still has enormous growth potential. UPS is a package delivery company that provides transportation and delivery, distribution, contract logistics, ocean freight, air freight, customs brokerage, and insurance services.
It operates through two segments:
- U.S. Domestic Package
- International Package
The U.S. Domestic Package segment provides time-definite delivery of letters, documents, small packages, and palletized freight via air and ground services within the United States.
The International Package segment provides guaranteed-day and time-definite international shipping services, comprising guaranteed-time-definite express options in:
- Europe
- Asia
- the Indian subcontinent
- the Middle East
- Africa
- Canada
- Latin America
UPS is not just a package delivery company. It also offers a range of services, including international air and ocean freight forwarding, post-sales support, and mail and consulting services.
Furthermore, it offers:
- Truckload brokerage services
- Supply chain solutions to the healthcare and life sciences industries
- Financial and information services
- Fulfillment and transportation management services
This broad portfolio of services ensures the company’s stability and potential for growth, making it an attractive investment option.
Citigroup has assigned a Buy rating with a target price of $158.
The 5 Highest-Yielding Monthly Dividend Stocks Deliver Gigantic Passive Income Streams
Top Gaining Stocks
Top Losing Stocks