The U.S. stock exchange contains plenty of public traded companies; but only a few of those are considered as blue chips. They are like pearls scattered on the ocean floor. These stocks are the gems of the stock exchange that provide consistently positive returns to the investors. Blue chip stocks are much sought after by the investors as they deliver higher dividends, greater price yields, and rising profits. Moreover, the returns on blue chips stocks are less volatile as compared to ordinary stocks.
The name “blue chips” comes from the game of poker where the blue betting disks (chips) have the highest value. Yet investing in blue chip stocks is a world apart from putting your money on the lifeline in a casino. Blue chip stocks offer stable, consistent returns and operate profitably even during economic downturns.
Do you want to know about the best blue chips to own in 2015? Then you should bear with us a little longer as we reveal the 11 best blue chip stocks that you should keep on your radar when purchasing stocks next year.
1. McDonald’s Corporation (NYSE:MCD)
McDonald Corporation is one of the biggest multinational food retailers that operate more than 30,000 franchises in about 117 countries. The dividend payout of blue chip stocks has been on an increase for the past 38 years.
The 10-year annual dividend growth rate of the blue chip stocks stands at 17.90% per year. It is expected that dividends will grow at a rate or 7%-10% per year in the coming decade. Recently the stock has been trading at around $96 per share. It has a P/E ratio of around 19.50 with dividend yield of 3.5%.
2. Nestle S.A. (NSRGY)
The Nestle is a Swiss multinational company that is the largest food company in the world in terms of revenues. Nestle stock dividends have increased consistently over the past two decades. The stock has been trading recently at $78.75 a share with a P/E ratio of nearly 17.00. The company will pursue a massive stock repurchase strategy that is expected to boost its earning by a large amount.
3. Apple Inc. (NYSE: AAPL)
Apple Inc. is a behemoth of the electronic industry. Since its resurgence under the visionary leadership of the late Steve Jobs, the company has experienced continued growth in both revenues and stocks prices.
Financial pundits are projecting that Apple Inc. would soon become the first trillion dollar company in the world. And in order to ride the waves of its meteoric rise to the top, you should purchasing shares of the electronic giant next year before it’s too late. Currently it is trading at $111.95 per share with P/E ratio of 17.36.
4. Colgate-Palmolive Company (NYSE:CL)
Colgate-Palmolive Co. is an excellent choice for investors. Best known for its oral hygiene products, the company has provided handsome dividends for the past few decades. It is also one of our best buys for 2015. The current stock price of the company stands at $68.87 a share with dividend yield of 2.09% and P/E ratio of 30.21.
5. Exxon Mobil (NYSE:XOM)
Exxon Mobil is an American multinational oil and gas company that needs no introduction. What is more important to know is that the blue chip company has consistently provided above average dividend payouts to the investors. It has one of the highest dividend yield in the market that stands at 3.11%. You can purchase share of the oil giant for just $88.67 a share. P/E of the blue chip oil stock stands at 11.15.
6. Johnson & Johnson (NYSE:JNJ)
Johnson & Johnson is one of the most well known consumer goods and pharmaceutical company in the world. The large portfolio of consumer products allow it to provide steady dividend payout returns. It is also one of the best company stocks to own in 2015. Stock price of the company stands at $106.24 per share with a P/E ratio of 17.59 and dividend yield of 2.64 %.
7. Cisco Systems Inc. (NYSE:CSCO)
The tech giant Cisco Systems Inc. mainly deals with networking equipment. It has one of the highest dividend yield that at present just touches 2.83%. Cisco shares are currently trading at just $26.87 per share. P/E of the company stands at a remarkable 18.28 which was 17.9 the previous year. Yahoo Finance projects EPS growth of company to be 7.6% in the next five years.
Looking forward, the company is heavily investing in the next IT revolution dubbed as IOE (Internet of Everything). IOE marks an evolution in internet that connects our electronic equipment to the cloud marking a great change in the way they are operated.
8. Reynolds American Inc. (NYSE:RAI)
Reynolds American Inc. has recently been in the news due to purchase of the rival firm Lorillard Inc. for a record $27.4 billion. The deal that will be finalized in 2015 will make it the second largest tobacco company in the world with market share of around 34%.
Stocks of the tobacco company are currently trading at $65.67 a share. The company has the second highest dividend yield of all the blue chip companies listed here. Divided yield of the company stands at a remarkable 4.08% with P/E ratio of 21.66.
9. International Business Machines (NYSE:IBM)
IBM is the leading multinational and consulting cooperation in the world. The company has prospered by leaps and bounds after it sold off its PC division to Lenovo. IBM is a big growth market and is position for superior growth and profitability in the coming decades. Stock price of the company stands at $160.97.
10. Philip Morris Inc. (NYSE:PM)
Phillip Morris, through its subsidiaries, manufactures and sells cigarettes and tobacco related products. The company has consistently outperformed the market for the past five years. Currently the stock price of the company stands at $85.6 a share with P/E and dividend yield of 17.25 and 4 % respectively.
11. ConcoPhilips (NYSE:COP)
ConcoPhilips is a large US energy company with stakes in Bakken shale of North Dakota and Eagle Ford Shale of Texas. The recent dip in oil prices has caused a panic among investors who are selling energy shares in record number. However, this has set the perfect stage for investors looking to diversify their portfolio by purchasing oil stocks. You can snap stocks of the company for just $63.54 a share that is expected to appreciate considerably in the coming years.
COP has a 5 years EPS growth rate of 7.24% with an interest coverage ratio of 19.4. Dividend yield of the company stands at 4.6% while the P/E ratio stands at 10.88.