For a variety of reasons, blue chip stocks are appealing to long-term investors. These are firms that have consistent cash flows and favorable financial positions, as well as established enterprises with a long track record of success. They also provide appealing dividend payments and a feeling of greater security for investors since they are frequently some of the world's most well-known firms. In today's market, blue chip stocks are even more enticing.
When equities fall to new lows and start to enter into correction territory, investors may take advantage of the volatility by purchasing these excellent firms at tempting price levels. These are the sorts of firms that long-term investors may keep for a long period, meaning buying shares when the market is down might be a very profitable decision.
Let's take a look at the top three blue-chip stocks to invest in for the long term:
Coca-Cola (NYSE: KO)
Coca-Cola's share price is near an all-time high, despite the fact that the stock market is experiencing significant selling pressure, which should tell investors everything they need to know about the company's quality. The world's largest soft drink firm, and the owner of some of the most well-known brand names in the world. Coca-Cola is also a leading producer of fruit juices and juice-related goods, having been in operation for over 130 years - the sort of longevity that long-term investors adore to see.
Coca-Cola stock is worth a look right now for a variety of reasons, even at all-time highs. By 2022, the firm's prospects look bright, and on-premises sales will resume following the epidemic, as Coca-Cola sells a lot of beverages in public places like movie theaters, cafés, and concerts. Analysts also predict that the company's multi-billion dollar IRS tax case will be concluded in the coming months, which would be a favorable sign for prospective investors who have been waiting for clarity. Finally, further reasons to add Coca-Cola stock in 2022, is a 2.76% dividend yield and Q3 adjusted EPS of $0.65 per share, up 18% year-over-year that make it very attractive.
Hormel Foods (NYSE:HRL)
Investors should be on the lookout for firms with a solid competitive position and a track record of rewarding shareholders, such as Hormel Foods. It's a global food and meat company, including fresh meats, sausages, bacon, luncheon meats, peanut butter, microwaveable meals, poultry, and other products. These are items that customers will always want to buy, so the business is a reliable source of consistent revenue and dividend payments. Hormel stock, is a dividend aristocrat stock with more than 56 years of dividend increases.
Hormel is a well-known blue chip stock with considerable expansion potential, as the firm may continue to expand into foreign markets in the future. In truth, Hormel has benefited from the acquisition of a South American meat business called Ceratti in 2017, giving the firm greater exposure in that market. Hormel investors should keep an eye on the firm's earnings in 2022, as the foodservice sector is expected to do well and lead to higher sales volumes.
Microsoft (NASDAQ: MSFT)
Microsoft stock is exciting because we believe it presents a great buying opportunity in the midst of these difficult circumstances for technology stocks. It's a huge business with a long history and plenty of favorable trends that investors can rely on for long-term development. For example, the firm's Microsoft Azure cloud service has been on fire as more businesses pursue digital transformations in response to the epidemic. Microsoft's wide range of business solutions, including Microsoft Office, can also help investors maintain consistent cash flows for years to come.
Just days ago, Microsoft announced a deal to acquire Activision Blizzard in an all-cash transaction, which is a major move that will help the company solidify its lead in the gaming business. Since its debut, the XBOX Series X has been a hit with customers, and the Activision acquisition should significantly enhance Microsoft's subscription gaming service XBOX Game Pass in the long term. While the stock is closing in on its 200-day moving average and may experience selling pressure in the near future, it's fair to say that Microsoft shares are becoming increasingly appealing for long-term investors with each new tick down.