7 of the Best Large-Cap Stocks to Buy for 2022

Look to large stocks for stability in a tough market.

There is a lot of uncertainty as we enter the second half of the year. Between rising interest rates, red-hot inflation and the ongoing war in Ukraine, there are plenty of reasons to rethink your investing strategy or worry about your holdings. If you’re tired of seeing red ink in your portfolio statements and wondering how to change course from tactics that worked well until recently, take a look at the following seven large-capitalization stocks. All are well-established names that can offer stability, as well as potential upside, as we close out a challenging 2022.

AT&T Inc. (ticker: T)

AT&T saw plenty of volatility over the last year, in part thanks to uncertainty around the spin-out of its media operations into what is now Warner Bros Discovery Inc. (WBD). However, shares are up more than 15% since that March split, and even though dividends edged down thanks to the now-smaller operations of the core telecom business, AT&T still yields an impressive 5.4% at these prices. Though T-Mobile US Inc. (TMUS) is ostensibly a third player in U.S. telecom, it is bloated with debt after its merger with Sprint, and in many ways this industry is just a two-horse race in the U.S. between AT&T and Verizon Communications Inc. (VZ). Now that the dust has settled, AT&T stock looks to have the wind at its back — and in a risk-off environment, the regular revenue from long-term subscribers will give great peace of mind.

Dollar Tree Inc. (DLTR)

Discounters like Dollar Tree and its subsidiary Family Dollar always do well in times when consumers are pinching pennies. This duo joined forces in 2015 to create one of the biggest discount retailers out there, and thanks to smaller locations in some urban locales where big-box stores won’t go, it has a built-in customer base that should keep coming through its doors en masse. Though plotting just 5% to 10% revenue growth both for this fiscal year and in 2023, it has also predicted a more than 40% increase in profits through year-end, owing to efficiency and strong margins. It may not have the cachet of some upscale blue chips, but DLTR is a large-cap stock worth watching in a tough year for American consumers.

Exxon Mobil Corp. (XOM)

To be clear, Exxon has some real long-term challenges in the age of climate change. However, it’s undeniably on the upswing after a stellar gain of about 40% since Jan. 1 to make it one of the best-performing large-cap stocks on Wall Street. Looking forward, Exxon Mobil has tripled its stock buyback plan to $30 billion on top of a generous and reliable dividend of 4% that is more than double that of the typical S&P 500 component. And let’s not forget other industries like Big Tobacco that have survived existential threats and gone on to deliver long-term shareholder value. There’s a good chance that if Exxon continues to be well-managed and responsible with its future plans, it can continue to deliver for many years.

Kraft Heinz Co. (KHC)

When it comes consumer staples, there is perhaps no more powerful brand portfolio than that of Kraft Heinz. On top of its namesake ketchup and macaroni and cheese, it owns Philadelphia cream cheese, Maxwell House coffee, Jell-O, Kool-Aid and a host of other iconic consumer brands. With prices going through the roof in all corners of the economy, many consumers are cutting back on restaurant visits and eating at home more. That is a big boon for KHC and a reason shares have posted a small gain in 2022 even as other blue chip stocks have lost ground. Throw in a 4% dividend yield, and there’s a lot to like about this grocery store icon.

McKesson Corp. (MCK)

Recently highlighted by U.S. News as one of the best growth stocks to buy right now, McKesson is a global leader in health care equipment and one of the best performers on Wall Street this year, with a roughly 30% rise since Jan. 1. That makes it one of the top 10 performers in the S&P 500 index and the No. 1 large-cap stock that is not in the energy sector. McKesson provides essentials to medical offices, surgery centers and hospitals, offering a recession-proof revenue stream that will withstand any market downturn. Whatever happens in the second half of 2022, this $47 billion healthcare giant has what it takes to succeed.

MercadoLibre Inc. (MELI)

Though not a domestic name, the $35 billion MercadoLibre is certainly a blue-chip stock worth watching. MELI is often referred to as the Amazon.com Inc. (AMZN) of Latin America, as it operates a consumer-focused internet marketplace and mobile payments platform that dominates Brazil and Argentina. While Western consumer discretionary stocks are facing uncertainty, the analyst community is expecting big things from this emerging market e-tailer with projected revenue growth of nearly 50% this fiscal year and another 30 in fiscal year 2023. MercadoLibre has seen a rash of upgrades this summer from big Wall Street firms like Citigroup, Goldman Sachs and Credit Suisse Group AG, and it could be an aggressive but profitable play for those who want to look beyond the more stable and traditional blue chips on this list.

Merck & Co. Inc. (MRK)

Merck is a Big Pharma mainstay with a rich history and a current portfolio of multibillion-dollar blockbusters including cancer immunotherapy Keytruda and diabetic treatment Januvia. On top of this, it is working on a $40 billion deal to acquire Seattle-based cancer biotech Seagen Inc. (SGEN) to further fuel its future growth. The current rough stock market environment has created a big buying opportunity for cash-rich companies like Merck that can make strategic acquisitions like this, and Wall Street has bid the stock up sharply in July on optimism around the deal. MRK is now up almost 17% on the year — and pays a nice 3% dividend on top as a sweetener.

7 of the best large-cap stocks to buy for 2022:

— AT&T Inc. (T)

— Dollar Tree Inc. (DLTR)

— Exxon Mobil Corp. (XOM)

— Kraft Heinz Co. (KHC)

— McKesson Corp. (MCK)

— MercadoLibre Inc. (MELI)

— Merck & Co. Inc. (MRK)

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