Key Takeaways
- 1Blue chips are large-cap companies with long track records of financial stability
- 2Not all blue chips are equal — our model separates outstanding from mediocre
- 3The best blue chips combine high profitability with reasonable valuations
- 4Even among elite companies, factor analysis significantly improves stock selection
#What Makes a Stock a Blue Chip?
- Large market capitalization — Typically $50 billion+
- Long operating history — Decades of proven performance
- Financial stability — Strong balance sheets and credit ratings
- Dividend payments — Most pay and grow dividends
- Market leadership — Dominant positions in their industries
Classic Blue Chips by Sector
| Sector | Blue Chips |
|---|---|
| Technology | Apple, Microsoft, Google |
| Healthcare | Johnson and Johnson, UnitedHealth |
| Financials | JPMorgan, Berkshire Hathaway |
| Consumer | Procter and Gamble, Coca-Cola, Walmart |
| Industrials | Honeywell, Caterpillar |
#Why Factor Analysis Matters for Blue Chips
Blue chip status does not mean good investment. General Electric was the ultimate blue chip — then lost 80% of its value. Our 6-factor model helps distinguish:
| Factor | What It Reveals |
|---|---|
| Profitability | Is the company still generating strong returns? |
| Momentum | Is the market recognizing its value? |
| Value | Are you overpaying for the blue chip premium? |
| Stability | How well does it hold up in downturns? |
#How to Build a Blue Chip Portfolio
- 1Use our rankings to identify the highest-scoring large-cap stocks
- 2Diversify across sectors — Do not concentrate in one industry
- 3Check valuations — Even great companies can be overpriced
- 4Reinvest dividends — Maximize the compounding effect
Last updated: February 10, 2026