What Are Blue Chip Stocks and Are They Good Investments?

IBM has paid dividends every year since 1916 and has raised dividends 23 years in a row. With a payout ratio typically less than 50%, IBM is able to grow its payout even amid industry difficulties. Chevron has hiked dividends for 32 years in a row, including a 6.3% increaseearlier this year. Over the past decade, dividend growth has averaged 6% annually, but slowed to less than 3% in the past five years.

1. However, these don’t necessarily invest exclusively in monthly dividend stocks — instead, they sell covered calls on stocks and use them to pay monthly dividends.
2. The collapse of Lehman Brothers and General Motors in the 2008 Economic Recession is proof that even the seemingly strongest companies might fail under extreme stress.
3. They provide a useful combination of growth and value characteristics that can balance the ups and downs caused by economic distress and market volatility.
4. Shell is actively re-shaping its portfolio and has shed more than $30 billion of non-core assets in recent quarters.
5. The declaration date refers to when a company’s board of directors announces an upcoming dividend payment to its shareholders.

In the US, the term blue chip was often used for things with higher values just like one uses terms like royal blood or pedigree. These high dividend blue chip stocks in india stocks also differ from high-beta stocks in that they are more resilient in grim stock market cycles but at the same time may not soar like them in a bull run. For the same reason, they also have more buyers and therefore are expensive in that they have a higher Price-to-Earnings or PE ratio. There are ETFs that pay dividends monthly, such as the JPMorgan Equity Premium Income ETF (JEPI) and the Global X Nasdaq 100 Covered Call ETF (QYLD).

Features of Blue Chip Companies

Interim dividend refers to a dividend payment made by a company to its shareholders during its financial year before the final annual dividend is declared. It is typically distributed when a company has generated sufficient profits and wants to share them with shareholders before the year-end. The Nifty50 constitutes the top 50 companies from various sectors with high market cap listed on the NSE (along with other eligibility criteria).

Thomas’ experience gives him expertise in a variety of areas including investments, retirement, insurance, and financial planning. Neither the author nor editor held positions in the aforementioned investments at the time of publication. If you’re looking for the best ETFs in terms of dividend yield, you may want to check out some of the highest-yielding dividend ETFs instead.

Top Indian Stocks Offering Over 5% Dividend Yield – Your Guide to Stable Returns

While their dividend yields are appealing, consider each company’s financial stability and market conditions to ensure sustainable returns. With government backing and steady dividends, these stocks can be valuable additions to a diversified portfolio focused on income. Amid market volatility, high-dividend stocks can provide a steady income stream, especially when stock prices dip. Here are five Indian blue-chip companies from sectors like mining, energy, and oil that are delivering dividend yields above 5%—great options for investors seeking resilient returns even in uncertain times.

1. Dozens of high-quality blue-chip stocks have been cut in price enough to lift their dividend yields above 4%.
2. The company also holds a major stake in the world’s largest solar project developer and investments in India’s renewable energy market.
3. Altria’s high recurring revenues, substantial cash flow and low existing debt should facilitate a rapid paydown of acquisition-related debt.
4. The company also paid out $3.4 billion in dividends and stock buybacks during the year, and increased its quarterly payout for the 10th consecutive year, to $1 per share.
5. Normally, such companies have operated for many years, have dependable earnings, and usually pay dividends to investors.

Resilience in Economic Downturns

Their financial strength and brand value contribute heavily to this characteristic. Bluechip companies have a history of operating successfully for many years, sometimes even for decades or centuries. These companies have demonstrated their ability to adapt to changing market conditions, including recessions.

Individual monthly dividend stocks

The accelerated rollout of 5G services during 2019 should provide additional growth momentum. Verizon has partnered with Samsung to launch the nation’s first commercial 5G service in Houston, Indianapolis, Los Angeles and Sacramento. General Mills’ purchase of Blue Buffalo pet food has been a game-changer for its e-commerce business, which grew 50% last year and could hit $1 billion in sales by 2020. Blue Buffalo is the No. 1 pet food brand in specialty and e-commerce channels. Blue chips get their name from the game of poker, where a blue chip has the highest value and is the most attractive to players. The collapse of Lehman Brothers and General Motors in the 2008 Economic Recession is proof that even the seemingly strongest companies might fail under extreme stress.

LYB has enjoyed a slew of upgrades over the past few months, including a December grade hike by Deutsche Bank analyst David Begleiter. He moved the stock from “Hold” to “Buy,” noting that the company trades at the low end of the range for commodity chemical stocks and has an attractive dividend that mitigates risk. Dominion has increased its dividend for 15 consecutive years and generated five-year dividend growth averaging 8.2% annually. How big a company needs to be to qualify for blue chip status is open to debate.

Top dividend paying stocks in India 2023: From Vedanta, Hindustan Zinc to Coal India and REC

The dividend yield lets the investor know, with very little doubt, when a share’s price is genuinely high, low or on the move between those two points. In India, several companies offer attractive dividend yields to their investors. Therefore, investors need to do their research and pick stocks that not only offer attractive dividend yields but also have a strong track record of consistent dividend payments and a healthy financial outlook. These high-dividend blue-chip stocks are attractive options for investors prioritizing passive income, especially during volatile markets.

Typically, blue chips demonstrate a history of exceptional performance and attractive returns for generations of investors. That’s why they can be an excellent addition to a portfolio (depending on your investment goals and style). For all of these reasons, blue chip stocks can make good investments and are among the most popular stock purchases for investors. Some examples of blue chip stocks are IBM Corp., Coca-Cola Co., Microsoft, American Express, McDonald’s, and Boeing Co. The declaration date refers to when a company’s board of directors announces an upcoming dividend payment to its shareholders.