20 Best Blue-Chip Stocks for 2020 and Beyond
Blue-chip stocks are often regarded as some of the best stocks to buy on Wall Street. Why?
Because the companies behind the blue chips are supposed to be the cream-of-the-crop. Large-cap titans of industry, with long histories of growth, strong management teams, rock-solid balance sheets, robust future growth prospects and tons of visibility to long-term gains in revenues, profits and the stock price.
In other words, these are the stocks that you want to buy today, and hold for the next 5 to 10 years, because strong fundamentals will power these stocks materially higher in the long run.
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With that in mind, here are my 20 favorite blue-chip stocks to buy for the 2020s:
- Facebook (NASDAQ:FB)
- Coca-Cola (NYSE:KO)
- Apple (NASDAQ:AAPL)
- Nike (NYSE:NKE)
- Adobe (NASDAQ:ADBE)
- Microsoft (NASDAQ:MSFT)
- McDonald’s (NYSE:MCD)
- Intel (NASDAQ:INTC)
- Clorox (NYSE:CLX)
- Amazon (NASDAQ:AMZN)
- Alphabet (NASDAQ:GOOG,NASDAQ:GOOGL)
- Lululemon (NASDAQ:LULU)
- PayPal (NASDAQ:PYPL)
- Alibaba (NYSE:BABA)
- AT&T (NYSE:T)
- Qualcomm (NASDAQ:QCOM)
- Netflix (NASDAQ:NFLX)
- Target (NYSE:TGT)
- Shopify (NYSE:SHOP)
- Walt Disney (NYSE:DIS)
Blue-Chip Stocks to Buy: Facebook (FB)
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One of the best blue-chip stocks to buy for the long term is Facebook, and the bull thesis on the social media giant is shockingly simple.
Through its ecosystem of four digital media apps with endless functionality, Facebook has created the world’s largest and stickiest digital ecosystem, without competition. Engagement in that ecosystem will only increase over time. As it does, more and more ad dollars — which are already pivoting from the offline to the online channel –
– will make their way into the Facebook ad machine.
Plus, the company has a huge opportunity in front of it to turn all that digital engagement into digital shopping, and create a world-class e-commerce platform with unparalleled reach.
To that end, Facebook projects as a solid 20%-plus revenue and profit grower over the next few years — and that’s easily big enough growth to sustain a big uptrend in FB stock.
Coca-Cola (KO)
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A more classic blue-chip stock to buy for the long term is Coca-Cola.
Coca-Cola is the world’s largest beverage company. More importantly, though, the company has found a winning strategy which ensures that it will remain the world’s largest beverage company for the foreseeable future.
That strategy includes leaning into data-driven market analysis to identify up-and-coming beverage brands, taking small stakes in those up-and-coming brands, pushing them through Coca-Cola’s vast distribution network, seeing which ones succeed in that distribution network and then subsequently wholly acquiring the brands that do succeed and fully integrating them into the Coca-Cola product portfolio.
It’s a win-win strategy which will forever ensure that Coca-Cola has the strongest and most relevant brands in its beverage portfolio, thereby sustaining solid revenue and profit growth for the foreseeable future.
That solid growth will power equally solid gains in KO stock.
Blue-Chip Stocks: Apple (AAPL)
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Another classic blue-chip stock to buy for the long term is Apple.
The world’s largest technology company with a $2 trillion market cap, Apple isn’t going anywhere anytime soon. The company’s hardware business is flourishing, as the iPhone’s global ubiquity is being protected by “good enough” hardware advancements, Mac and iPad sales should boom in an hybrid work environment and Apple Watch sales should keep surging as 5G unlocks a new era of advanced IoT communication.
Meanwhile, Apple is rapidly expanding its software ecosystem, too, building out things like Apple TV+, Apple Arcade, Apple Music, so on and so forth. These services will see continued robust uptake for the foreseeable future as consumer engagement shifts to the digital — and specifically mobile — channel.
The convergence of growth in both its hardware and software businesses will help power big revenue and profit gains at Apple over the next few years. Those big gains will keep the current uptrend in AAPL stock alive for a lot longer.
Nike (NKE)
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In the apparel world, the best blue-chip stock to buy for the the long term is Nike.
The whole world is pivoting towards broader adoption of athletic apparel in situations outside of just working out, mostly because consumers are opting for comfort over fashion, and athletic shorts, leggings and tank tops represent some of the comfiest clothes out there. This trend won’t reverse course anytime soon. Athletic apparel will remain the “in” style for many years to come.
Nike is at the top dog in the industry. Without much competition. The company has leaned into its relentless product innovation, star-studded portfolio of athlete endorsements and purpose-driven marketing to continually elevate brand equity and consumer demand. This trend won’t reverse course anytime soon, either. Nike will remain the king of athletic apparel for many years to come.
It doesn’t take a rocket scientist to connect those dots. Nike projects as the best-in-breed apparel retail company for a lot longer, a reality which means NKE stock is sold stock to buy for the next 5 to 10 years.
Blue-Chip Stocks: Adobe (ADBE)
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Adobe is a great blue-chip stock to buy for three very simple reasons.
One, the company dominates in the visual media solutions space — a space which, thanks to the fact that the world increasingly communicates in pictures and videos, is underpinned by secular growth drivers. Adobe’s solutions in this space will maintain robust demand over the next few years.
Two, the company also dominates in enterprise virtualization solutions, helping companies on their paper-to-digital transformations. As the world increasingly pivots into a hybrid work environment, this transformation will accelerate, and demand for Adobe’s digital document solutions will increase.
Three, Adobe is making aggressive and impressive moves in the enterprise cloud world, where the company is leveraging its visual media expertise to develop visually-driven cloud marketing solutions for enterprises. This business has huge long-term potential.
All in all, then, Adobe will continue to grow revenues and profits at a solid double-digit pace over the next 5+ years, a stretch during which ADBE stock should just keep running higher.
Microsoft (MSFT)
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When it comes to blue-chip technology stocks, Microsoft is about as good as it gets.
The company has long been a global technology powerhouse. It has maintained this strong standing because the company continues to innovate and create relevant offerings in the tech world.
The most recent innovation, of course, is in cloud, where Microsoft has developed a series of cloud-hosted infrastructure, productivity and collaboration tools which help facilitate hybrid work environments.
Demand for these tools will remain robust for the next several years.
As it does, MSFT stock will keep pushing higher.
Blue-Chip Stocks: McDonald’s (MCD)
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In the food space, the best blue-chip stock to buy is McDonald’s.
McDonald’s dominates on the two things that matter most in the fast casual restaurant space: price and convenience.
McDonald’s consistently innovates to reduce labor costs and food costs so as to offer the lowest prices in the market on burgers, fries and shakes. At the same time, the company has the largest fast food footprint in the world, with a McDonald’s seemingly on every corner of every city in the world. On top of that, technological improvements — like automated ordering kiosks and streamlined digital ordering — only enhance McDonald’s convenience.
So long as McDonald’s continues to dominate on the price and convenience fronts, MCD stock will stay on a long-term uptrend.
Intel (INTC)
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The stock has been beaten and bruised over the past few months thanks to product delays, but semiconductor giant Intel remains one of the best blue-chip stocks to buy for the 2020s.
The bull thesis is simple. Intel may be fumbling right now. But this is the 400 pound gorilla in the global CPU market, which has a long track record of operational excellence, and enough resources and talent to get the company back on track over the next few years.
Once Intel does get back on track in terms of speed-to-market, there’s a lot to like, mostly because the global CPU market will see significant demand growth in the 2020s thanks to the widespread proliferation of 5G, AI, IoT, cloud, AR/VR, self-driving, etc.
With all that in mind, Intel stock is a great buy for the next decade.
Blue-Chip Stocks: Clorox (CLX)
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Thanks to the Covid-19 pandemic, we are entering a “new normal”, and because of that, Clorox stock is one of the best blue-chip stocks to buy for the 2020s.
I’m not all that pessimistic about the implications of the pandemic over the next several years. I don’t think mask-wearing and social distancing will become the norm for years. Instead, I think the world will return to mostly normal over the next few years.
But one thing that will permanently change is consumer awareness of hygiene and cleanliness. Individuals and businesses alike are going to use more hand sanitizer, disinfectant wipes, Lysol spray, etc.
Who makes all those products? Clorox.
As such, in the “new normal”, demand for Clorox cleaning materials will remain vigorous. This sustained vigorous demand will guide CLX stock higher over the next several years.
Amazon (AMZN)
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Of course, this list of blue-chip stocks to buy would be incomplete without Amazon.
The e-commerce and cloud computing juggernaut with burgeoning digital ad, video game streaming and offline retail businesses is, without question, one of the best stocks to buy for the next 5 to 10 years.
That’s because everywhere consumers and businesses are pivoting, Amazon is already there, with a best-in-market offering.
The company owns the e-commerce and cloud computing spaces. They also own the video game streaming market, and have a huge digital ad business. Plus, there’s a ton of potential for Amazon to pioneer an era of next-gen, automated offline retail, and make a big splash in self-driving logistics with its recent acquisition of Zoox.
All in all, it’s quite clear that Amazon will remain a big growth company for a lot longer — and that AMZN stock will remain a big winner for a lot longer, too.
Blue-Chip Stocks: Alphabet (GOOG)
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Next to Facebook, Amazon, Microsoft and Apple, Alphabet is yet another solid blue-chip tech stock to buy for the 2020s.
more than 90% of the internet search market.
This ubiquity puts Alphabet at the epicenter of the secular shift in ad dollars from offline to online, which in it of itself, will support solid growth at Alphabet over the next decade.
But Alphabet’s bull thesis doesn’t end with Google Search.
There’s YouTube, a hyper-growth visual media platform that’s also unrivaled in terms of size in that space. There’s Google Cloud, the third largest cloud computing business in the world. And, of course, there’s Waymo — the company’s self-driving unit that is widely considered the number one autonomous driving business in the world.
Between all those growth levers, Alphabet — and GOOG stock — will remain big winners for the foreseeable future.
Lululemon (LULU)
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Athletic apparel is the hottest trend in the retail world today — and will remain so for the foreseeable future.
While Nike is the best blue-chip stock to buy in this space, Lululemon is a very close runner-up.
top-of-mind for young consumers. Some of this success is because of the company’s high-quality clothes, while some is due to Lululemon’s continued innovation in its product pipeline to extend well beyond its legacy leggings.
All of these trends will remain in place for the next few years.
As they do, Lululemon will continue to grow sales at a 10%-plus pace, and LULU stock will keep powering higher.
Blue-Chip Stocks: PayPal (PYPL)
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Cash is quickly becoming antiquated thanks to the consumer pivot towards e-commerce, and as a result, PayPal stock is one of the best blue-chip stocks to buy today.
Of course, when buying things online, you can’t use cash. So consumers are rapidly adopting alternative payment methods for the digital channel. PayPal is the largest of those alternative digital payment methods.
On that basis alone, PayPal should grow at a healthy pace over the next several years as consumers continue to pivot towards digital shopping.
But PayPal also owns Venmo — the world’s hottest mobile payment platform — which will continue to grow rapidly over the next several years as the mobile payments space expands globally.
Venmo plus PayPal equals huge growth.
And huge growth will keep PYPL stock on a winning streak.
Alibaba (BABA)
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Moving across the Pacific Ocean, Alibaba is the best blue-chip Chinese stock to buy for the 2020s.
China’s digital economy is booming. You have the largest country in the planet in terms of people. That country is rapidly digitizing and urbanizing. Incomes are rising. The middle class is expanding.
Alibaba is at the epicenter of all of that.
With the country’s biggest e-commerce platform, biggest cloud computing business and various other hyper-growth digital businesses.
That’s a recipe for long-term success.
Over the next several years, as China’s digital economy booms, Alibaba will boom, too, and BABA stock will continue to track higher.
Blue-Chip Stocks: AT&T (T)
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Maybe the most “boring” stock on this list of blue-chip stocks to buy is telecommunications giant AT&T.
But don’t let AT&T’s boring-ness fool you.
This is a top quality blue-chip stock, supported by a long track record of dominance in the telecom space, and enduring demand for wireless, internet and TV connectivity services.
5G will be a huge catalyst for this stock, as it will increase demand for those connectivity services and likely lead to higher prices and better margins for AT&T. Plus, this telecom company is now basically a media company with the acquisition of Time Warner. Using media assets acquired in that deal, AT&T recently launched HBO Max — the company’s version of Netflix.
All together, then, AT&T may not grow as quickly as the other companies on this list. But demand is stable, and the growth outlook is good enough that this really cheap stock should perform strongly over the next few years.
Qualcomm (QCOM)
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One of the most defining megatrends of the 2020s will be the widespread proliferation and global normalization of 5G.
The best blue-chip stock to buy to play this megatrend is Qualcomm.
Qualcomm makes the chips which power smartphones, and the company has created what is essentially a monopoly in the smartphone chips market. This monopoly has been pressured by smartphone makers like Apple and Huawei trying to make their own chips in recent.
Both companies were unsuccessful. Both are now long-term Qualcomm customers… again.
To that end, it’s clear to see that Qualcomm is really unrivaled when it comes to making smartphone chips, at a time when smartphone demand will roar high thanks to 5G making these phones faster and better than ever before.
Thus, over the next few years, Qualcomm’s revenues and profits will charger higher on the back of 5G tailwinds. So will QCOM stock.
Blue-Chip Stocks: Netflix (NFLX)
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Netflix is on its way to reaching global internet household ubiquity, and accordingly, NFLX stock is a great blue-chip stock to buy for the next 5 to 10 years.
The idea here is simple.
Netflix created the streaming TV category. Now, thanks to price and convenience advantages, streaming TV is replacing linear TV as the preferred media consumption channel. By the end of the decade, every internet household in the world will subscribe to some streaming TV service.
Netflix will undoubtedly be one of the streaming TV services which every household in the world does subscribe to.
Sure. There’s lot of competition in this space. But Netflix has first-mover advantage, which has given the company more resources and more data to make better original content than anyone else in the streaming space.
Better content attracts more subs. More subs gives the company more resources and more data, which leads to better content. Lather. Rinse. Repeat.
This favorable growth flywheel will enable Netflix to keep growing by leaps and bounds over the next several years.
Target (TGT)
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Physical retailers are tough to pitch as “top blue-chip stocks to buy” given that consumers are migrating out of the physical shopping channel and into the digital one.
But entirely digital isn’t the future of retail. Omni-channel is — and a result, Target is a top blue-chip stock to buy for the next few years.
Target has become a master in omni-channel retail. The company has revamped physical stores and integrated them with a bunch of technology so that the in-store shopping experience is much better than before. The company has also created a robust e-commerce platform backed by a widespread logistics network, and developed a myriad of omni-channel capabilities (like buy online, pick-up-in-store) to marry the physical with the digital.
In other words, Target has established a solid foundation to be a strong retailer for many years to come. The company’s ever expanding one-stop-shop value prop doesn’t hurt, either.
Thus, over the next few years, Target will sustain steady revenue and profit growth. That steady growth will power steady gains in TGT.
Blue-Chip Stocks: Shopify (SHOP)
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The hottest company on this list of blue-chip stocks to buy is Shopify.
The e-commerce platform company has emerged as one of Wall Street’s favorite companies because it is providing online selling tools which are becoming absolutely necessary for small to medium sized merchants, most of whom didn’t have an internet presence in 2019 but all of whom are being forced into the online channel in 2020.
This trend will accelerate over the next several years. Online shopping will only increase. More and more businesses will lean into their e-commerce operations. And websites will become the new storefronts, in that they will reach merchant ubiquity.
Who will build those websites? Make them pretty? Enable them to process transactions? Tie them into a robust logistics network?
Shopify.
And that’s why Shopify will remain a huge growth company for the next 5 to 10 years.
Walt Disney (DIS)
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Last, but not least, on this list of blue-chip stocks to buy for the 2020s is Walt Disney.
Yes, Disney is getting absolutely killed right now by the Covid-19 pandemic. The only sports on are the NBA and MLB. Theme parks are closed. Movie theaters are closed. TV advertising is falling.
But today is not a permanent situation. It’s a fleeting one. Broad and easy general public access to a Covid-19 vaccine — which is likely by 2021 — will propel the world back into a more “normal” state.
Sports will come back. Theme parks and movie theaters will re-open. TV advertising will rebound.
The Magic Kingdom will get back to being, well, magical — and over the next 5 to 10 years, strong demand for the company’s portfolio of media and entertainment properties will push DIS stock higher.
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