Some of these blue-chip stocks also offer quarterly dividends which makes it easier to hold onto shares. While most growth stocks have low yields, some of these stocks have yields above 1%. Also, they have impressive annualized dividend growth rates, so one might be able to live off the cash flow by the time of retirement.
Investors should look at a company’s financial growth, long-term catalysts and valuation when determining if a stock presents a buying opportunity. Starting off with household names is less risky than finding new and emerging companies. It’s a good starting point for new investors so explore some top high-growth blue-chip stocks.
Chipotle (CMG)
Chipotle (NYSE:CMG) continues to grow at a rapid pace despite inflation making people more careful about spending money. The company reported 14.1% year-over-year (YOY) revenue growth and increased its net income by 23.2% YOY in the first quarter. Chipotle also opened 47 new restaurants in the quarter and remains on pace to opening 285-315 new restaurants this year.
Those new restaurants will make it easier for Chipotle to report solid financial growth in future years. However, the company isn’t only achieving solid numbers because it’s opening more restaurants. Comparable restaurant sales increased by 7.0% YOY, demonstrating the stickiness of Chipotle restaurants in their local areas.
Moreover, Chipotle stock is in the middle of a correction as excitement fades after the 50-for-1 stock split was finalized. However, shares are still up by 33% year-to-date (YTD) and have roughly quadrupled over the past five years. Rising revenue and profit margins suggest that the stock can generate higher returns for long-term investors.
Visa (V)
Visa (NYSE:V) is the largest credit and debit card issuer with a market cap of $533 billion. Also, the fintech firm reports the highest profit margins among its competitors. Visa’s net profit margin came to 53.1% in the Q2 of fiscal year 2024 as revenue and net income both increased by 10% YOY.
The credit and debit card issuer cited cross-border transactions as a key growth driver. Cross-border volume increased by 16% YOY while overall payments volume was up by 8% YOY.
In addition, Visa has delivered a 48% gain over the past five years and is projected to rally by 19% from current levels. That’s the belief of 22 Wall Street analysts, and they have given the stock a strong buy consensus rating. The highest price target of $345 suggests even more upside, creating the possibility of a 30% gain from the current price.
As investors wait for those gains to arrive, they also get to enjoy a quarterly dividend. Although Visa has a yield below 1%, the fintech company has maintained a double-digit dividend growth rate for many years.
Walmart (WMT)
Walmart (NYSE:WMT) has been offering affordable prices on a wide range of goods for more than 60 years. The retailer has also delivered impressive gains for long-term investors during that stretch.
Buying Walmart a few decades ago would have resulted in generational returns, but the stock is still marching upward. Shares are up by 31% YTD and have gained 82% over the past five years. The stock trades at a 30 P/E ratio and offers a 1.19% yield.
Revenue and net income continue to rise for the corporation. Further, Q1 of FY 2025 results revealed that revenue increased by 6.0% YOY while adjusted earnings per share jumped by 22.4% YOY. The company closed out the quarter with a slight dip in global inventory to maintain healthy in-stock levels.
While retail has defined Walmart for decades, the company is growing at a fast rate in two exciting verticals. Global e-commerce sales increased by 21% YOY. More customers are ordering online and are arriving to Walmart locations to pick up their items. Also, Walmart is profiting from its advertising segment which delivered 24% YOY growth.
Broadcom (AVGO)
Broadcom (NASDAQ:AVGO) has regularly outpaced the stock market as customers can’t get enough of the company’s chips.
Shares are up by 61% YTD and have soared by 512% over the past five years. Broadcom trades at a 75 P/E ratio and comes with a 1.20% yield. Also, the tech giant has maintained a double-digit dividend growth rate for many years, including a 14% dividend hike for FY 2024.
The dividend isn’t the only thing going up. Broadcom reported 43% YOY revenue growth in Q2 of FY 2024 and raised its full-year guidance. Artificial intelligence (AI) product sales reached a record $3.1 billion in the quarter as tailwinds from the industry remain strong. Hock Tan, Broadcom’s President and Chief Executive Officer (CEO), mentioned in the press release that more enterprises are “[adopting] the VMware software stack to build their own private clouds.”
The acquisition has bore fruit for Broadcom, and Wall Street is certainly on board. The stock is rated as a strong buy as it approaches a 10-for-1 stock split. The average price target suggests an 8% upside from current levels.
Caterpillar (CAT)
Caterpillar (NYSE:CAT) has been providing construction equipment for almost 100 years. It’s endured various economic cycles, including the Great Depression, and looks like it will stick around for centuries. Caterpillar has delivered solid gains for investors during that stretch, including a 12% YTD gain. And, shares are up by 136% over the past five years.
The construction equipment company pays a steady dividend and currently yields 1.73%. The company tends to raise its dividend by 8% each year. Caterpillar’s 53.7% YOY growth in diluted EPS suggests that the company can maintain a high dividend growth rate for several years. Revenue was flat YOY, resulting in an 18.1% net profit margin.
Wall Street analysts are bullish about Caterpillar’s long-term prospects. The stock is currently rated as a moderate buy with a projected 14% upside from current levels. The highest price target of $440 per share implies that Caterpillar can gain an additional 35%.
JP Morgan (JPM)
JP Morgan (NYSE:JPM) is one of the few big bank stocks that continues to perform well. Shares are up by 20% YTD and have gained 805 over the past five years. The stock trades at a 12.5 P/E ratio and offers a 2.22% yield.
The company reported solid financials results that featured 11.1% YOY revenue growth and 6.3% YOY net income growth in the first quarter. Those growth rates resulted in a 33.5% net profit margin.
Wall Street analysts believe that the stock can rally higher. It is currently rated as a moderate buy among 23 analysts with an average price target that suggests a 3% upside. The highest price target of $239 is more optimistic and indicates that shares can rally by an additional 15% from current levels. JP Morgan is a large, established bank that stands to benefit amid regional banking struggles. The bank has navigated various economic cycles during its lengthy history and looks poised to deliver long-term gains for investors.
Nvidia (NVDA)
Nvidia (NASDAQ:NVDA) is the leader of the AI revolution. The tech giant briefly became the world’s most valuable publicly traded corporation, and it looks like it can reclaim that crown. Nvidia continues to report otherworldly earnings, including 262% YOY revenue growth in Q1 of FY 2025. Net income increased by 628% YOY during the same timeframe.
Many corporations are investing heavily into AI, and tailwinds seem poised to continue. Nvidia produces the top AI chip, and that distinction has resulted in substantial gains for long-term investors. Shares are up by 173% YTD and have gained more than 3,000% over the past five years. A stock split brought more attention to the stock, but it continues to perform well even after the split.
Nvidia has plenty of fans in Wall Street. It’s currently rated as a strong buy with a projected 6% upside from current levels. The highest price target of $200 per share indicates that shares can rally by an additional 52%.
On this date of publication, Marc Guberti held long positions in AVGO and NVDA. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Marc Guberti is a finance freelance writer at InvestorPlace.com who hosts the Breakthrough Success Podcast. He has contributed to several publications, including the U.S. News & World Report, Benzinga, and Joy Wallet.