Blue chip stocks are big, well-established, dividend-paying corporations with strong business prospects. These are companies that also have sound management that should be able to make the right moves to keep competing successfully in a changing marketplace.
The root of the term “blue chip” stems from the game of poker, as the blue chips represent the highest value. Investing in blue chip stocks can give you an additional measure of safety in today’s turbulent markets.
Pat McKeough believes investors will profit most, and with the least amount of risk, by putting the bulk of your stock portfolio in shares of blue chip companies—those that are well-established, with strong balance sheets and steady earnings and cash flow. These are companies that have bright prospects in healthy and growing industries.
The best blue chips offer both capital gains growth potential and regular dividend income. The dividend yield is certainly one of the most concrete indicators of a sound investment. It is the percentage you get when you divide the current yearly dividend payment by the share or unit price of the investment. It’s an indicator we pay especially close attention to when we select stocks to recommend in our investment newsletters.
We feel most investors should hold the largest part of their investment portfolios in securities from blue chip companies. All these stocks should offer good “value”—that is, they should trade at reasonable multiples of earnings, cash flow, book value and so on. Ideally, they should also have above average-growth prospects in expanding markets.
Meanwhile, when investing in any type of stock, at TSI Network we recommend using our three-part Successful Investor strategy:
1-Invest mainly in well-established companies;
2-Spread your money out across most if not all of the five main economic sectors (Manufacturing & Industry; Resources & Commodities; Consumer; Finance; Utilities);
3-Downplay or avoid stocks in the broker/media limelight.
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We continue to recommend all investors own at least one of Canada’s railways due to their importance to the national economy. While our top pick is Canadian Pacific Kansas City Ltd. (Toronto symbol CP), we also like the outlook for its main rival, Canadian National.
After… Read More
IBM, $164.43, is still a buy. The company (New York symbol IBM; Shares outstanding: 918.6 million; Market cap: $151.1 billion; TSINetwork Rating: Above Average; Dividend yield: 4.0%) has shifted its focus in the past few years to its more-profitable cloud computing, consulting and mainframe businesses.
In the three months… Read More
Loblaw and Metro remain leading competitors in their markets. We see both stocks as buys.
LOBLAW COMPANIES, $152.84, is a buy. The retailer (Toronto symbol L; Shares outstanding: 306.7 million; Market cap: $46.9 billion; TSINetwork Rating: Above Average; Dividend yield: 1.2%; www.loblaw.ca) operates 1,104 supermarkets under several banners, including Loblaws,… Read More
We’re always wary of big acquisitions like the company’s April 2023 purchase of U.S.-based railway Kansas City Southern for $31 billion U.S. Still, the deal is a rare case: here, the buyer knows nearly as much about the business as the seller. The merger also lets CPKC… Read More
VISA INC. $275 is a buy. The company (New York symbol V; Conservative Growth Portfolio, Finance sector; Shares outstanding: 2.05 billion; Market cap: $563.8 billion; Price-to-sales ratio: 17.0; Dividend yield: 0.8%; TSINetwork Rating: Above Average; www.visa.comwww.visa.com) operates the world’s largest electronic-payments network. It processes credit, debit, prepaid and… Read More
CANADIAN PACIFIC KANSAS CITY LTD. $120 is your #1 Conservative Buy for 2024. The railway (Toronto symbol CP; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 932.6 million; Market cap: $111.9 billion; Price-to-sales ratio: 9.0; Dividend yield: 0.6%; TSINetwork Rating: Above Average; www.cpkcr.com) aims to cut its… Read More
LOBLAW COMPANIES, $149.95, is a buy. The retailer (Toronto symbol L; Shares o/s: 310.0 million; Market cap: $46.4 billion; TSINetwork Rating: Above Average; Dividend yield: 1.2%; www.loblaw.ca) operates 1,104 supermarkets under several banners, including Loblaws, Zehrs, Provigo, Real Canadian Superstore and No Frills. Its Shoppers Drug Mart operates 1,351… Read More
In the past few years, IBM has shifted its focus to its more-profitable cloud computing, consulting and mainframe businesses. It now gets over 75% of its revenue from software and consulting services. The shift has paid off, with the stock recently hitting an all-time high… Read More
CANADIAN NATIONAL RAILWAY CO. $172 (www.cn.ca) remains a buy. Canada’s largest railway has reached a new three-year contract agreement with the union representing 2,500 of its track and bridge employees. They maintain its tracks across Canada. CN has not yet said how much extra it will pay under… Read More
TORONTO-DOMINION BANK $80 is a buy. The lender (Toronto symbol TD; Conservative Growth and Income Portfolios, Finance sector; Shares outstanding: 1.8 billion; Market cap: $144.0 billion; Price-to-sales ratio: 2.8; Dividend yield: 5.1%; TSINetwork Rating: Above Average; www.td.com) cancelled its deal to acquire First Horizon Corporation (New York symbol… Read More
BANK OF MONTREAL $124 is a buy. The bank (Toronto symbol BMO; Conservative Growth and Income Portfolios, Finance sector; Shares outstanding: 713.0 million; Market cap: $88.4 billion; Price-to-sales ratio: 2.7; Dividend yield: 4.9%; TSINetwork Rating: Above Average; www.bmo.com) completed its $13.8 billion U.S. acquisition of Bank of the… Read More
Royal Bank now plans to complete its acquisition of HSBC’s Canadian operations in March 2024. That $13.5-billion purchase enhances Royal’s domestic operations. Moreover, costs savings from the elimination of overlapping operations should also spur earnings.
Banking regulators have toughened lending standards and mortgage stress-test levels in… Read More
IBM, $183.66, is still a buy. The stock (New York symbol IBM; Shares outstanding: 913.1 million; Market cap: $171.6 billion; TSINetwork Rating: Above Average; Dividend yield: 3.6%) is near new highs after releasing its latest results.
In the past few years, IBM has shifted its focus to its more-profitable… Read More
Here are our top U.S. stock picks for 2024—one each from our Conservative, Aggressive and Income portfolios.
All three are in a strong position to fuel your returns, not only in 2024 but–more importantly–for many years to come. Moreover, their position as market leaders will help… Read More
ELI LILLY & CO., $628.91, is still a buy. The company (New York symbol LLY; TSINetwork Rating: Above Average) (www.lilly.com; Shares o/s: 949.3 million; Market cap: $602.4 billion; Dividend yield: 0.8%) was a #1 Power Buy for 2023 at $352.01 a share. It’s now up a very solid 78.7%.
That gain came… Read More
CAE INC. $28 is a buy. The company (Toronto symbol CAE; Conservative Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 318.3 million; Market cap: $8.9 billion; Price-to-sales ratio: 2.1; Dividend suspended in March 2020; TSINetwork Rating: Average; www.cae.com) is a leading maker of flight simulators for commercial and… Read More
In a search for your top 2024 buys, we’ve once again selected three stocks (one each from the Conservative, Aggressive and Income Portfolios).
We feel all three are poised to deliver big gains for our readers, not only this year but for many years to come… Read More
TELUS, $23.93, is a buy. The company (Toronto symbol T; Shares outstanding: 1.5 billion; Market cap: $34.8 billion; TSINetwork Rating: Above Average; Dividend yield: 6.1%; www.telus.com) had 12.87 million wireless subscribers as of September 30, 2023. It also sells landline phone, Internet and TV services in B.C., Alberta and… Read More
IBM, $160.10, is still a buy. The company (New York symbol IBM; Shares outstanding: 913.1 million; Market cap: $147.5 billion; TSINetwork Rating: Above Average; Dividend yield: 4.2%) in the past few years has shifted its focus to its more-profitable cloud computing, consulting and mainframe businesses. It now gets… Read More
TD Bank shares are still down 22% from their peak of $109 in February 2022. That’s mainly because rising interest rates have forced it set aside more funds for potential loan defaults. However, Canada’s banking regulator has toughened lending standards and mortgage stress-test levels in… Read More
