When the going gets tough, the tough buy blue chip stocks.
That’s because they are safe havens in times of turmoil. These are large companies with a proven track record of success and profits that have sterling financial statements. That means when markets go south, they will continue standing tall.
The following three blue chip stocks to buy are the leading players in their class. They have decades, if not centuries, of experience and have been through numerous business and economic cycles. From wars and depressions to global pandemics and recessions, these blue chips have not only survived but thrived.
The market is rewarding them currently with shares up by double-digit percentages in 2024. If stock prices plunge, these are three stalwart blue chip stocks to buy.
JPMorgan Chase (JPM)
JPMorgan Chase (NYSE:JPM) is the bank other banks turn to in times of trouble. It’s the bank the government turns to when the economy needs to be bailed out. During the Panic of 1907, the financial markets meltdown of 2008 and the regional banking crisis last year, it was JPM that was the financier of last resort to saving the country’s banking system.
It is well-rewarded for its efforts. Profits last quarter were massive, $13.4 billion or $4.63 per share, up 13% year-over-year (YOY). This happened in spite of a special assessment charge of $725 million for uninsured deposits of certain failed banks from last year’s crisis.
Additionally, it’s profiting from the present high interest rate environment. Net interest income last quarter jumped 11% to $23.2 billion. With the Federal Reserve now hesitant about cutting interest rates because of rising inflation, expect JPMorgan Chase’s profits to continue expanding. If and when interest rates do come down, the banking giant may feel pressure because its balance sheet has greater asset sensitivity.
However, it will not become materially weaker as a result. Investors should use any decline in its stock price as an opportunity to buy.
Walmart (WMT)
Think of Walmart (NYSE:WMT) as the JPMorgan Chase of retailers. It is the rock upon which the waves of worry crash but simply wash over. The only time the retail behemoth ever really experiences trouble is when it strays from its position as the everyday low-price leader.
Consumers come to Walmart because they know the company is wringing every last bit of pricing out of its suppliers. The ability to be on store shelves in front of 95% of Americans who live within a few miles from one of many supercenters is worth giving up a few points of margin. Vendors can make up in volume what they lose in per-item profits. And Walmart passes those savings on to consumers. It is the reason they return again and again to shop Walmart’s aisles. Comparable sales rose 4% last quarter helping to push net sales up 5.7% and operating income 30.4% higher.
Walmart stock is up 20% over the past year and should be on your shopping list if prices plunge.
Procter & Gamble (PG)
Consumer products legend Procter & Gamble (NYSE:PG) has been in business for almost 200 years. Founded in 1837, the owner of Pampers diapers, Downy fabric softener, Tampax feminine care products and more is a staple on every consumer’s shopping list. Few people can go a whole day without using one of Procter & Gamble’s products in their lives.
That kind of consumer touch is a testament to the quality of its products and the power that comes with brand name goods. Especially when the economy turns sour, consumers reach for name brand products. They know the quality and consistency of its products will deliver, no matter what. Even though shoppers are paying up for the product, they’re willing to do so because they know what they’re getting. “You get what you pay for” is a mantra that sustains P&G.
While all the companies on this list pay a dividend and have done so for years, Procter & Gamble is special. It has paid a dividend every year since 1890 and has increased the payout for 68 consecutive years, making it a Dividend King.
On the date of publication, Rich Duprey held a LONG position in PG stock. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
