As 2024 closes, many investors are wondering what the market’s performance indicates for 2025.
Yes, the S&P 500 has gained roughly 25% year to date. However, the post-election pop we saw on Wall Street has since faded, as fears of costly trade wars, continued dysfunction in Washington and general economic uncertainty seem more likely than any easy wins for the economy or the stock market in the months ahead.
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For those who aren’t interested in guessing what’s next, blue-chip stocks offer both peace of mind and long-term consistency that may be of comfort. The definition of a blue-chip stock isn’t hard and fast, but generally these companies are characterized by massive operations and consistent profits in any environment. That means there’s no need to watch fast-moving trends in crypto, artificial intelligence (AI) or biotechnology, and instead investors can kick back and depend on their strong portfolios to keep moving regardless of the news cycle.
The following 10 stocks all are different variants on this theme. But each company is characterized by a market value north of $40 billion to prove its scale and an annual dividend yield of 2% to indicate consistent and reliable profits that can be doled out to shareholders in 2025 and beyond.
| Stock | Sector | Market capitalization | Dividend yield |
| 3M Corp. (ticker: MMM) | Industrials | $70 billion | 2.2% |
| Altria Group Inc. (MO) | Consumer staples | $90.7 billion | 7.6% |
| AT&T Inc. (T) | Communication services | $164 billion | 4.9% |
| Corning Inc. (GLW) | Technology | $41 billion | 2.4% |
| Digital Realty Trust Inc. (DLR) | Real estate | $61 billion | 2.7% |
| Gilead Sciences Inc. (GILD) | Health care | $117 billion | 3.3% |
| Goldman Sachs Group Inc. (GS) | Financial services | $182 billion | 2.1% |
| International Business Machines Corp. (IBM) | Technology | $207 billion | 3.0% |
| Kinder Morgan Inc. (KMI) | Energy | $61 billion | 4.3% |
| Southern Co. (SO) | Utilities | $91 billion | 3.5% |
3M Corp. (MMM)
Sector: Industrials Market capitalization: $70 billion Dividend yield: 2.2%
A raw materials supplier, 3M produces specialty products ranging from adhesives to sealants to lubricants. Its massive portfolio spans more than 60,000 chemicals and materials, serving nearly every industry out there. After a few years of operational underperformance, management and strategy changes really started to bear fruit in 2024 as the firm significantly raised its full-year margin and earnings guidance. This resulted in a pop of more than 40% for shares in 2024. The company’s amazing, six-decade history of dividend increases ended with a 50% cut in 2024, but it still boasts a dividend yield above 2%. That combination of a return to growth plus significant income potential makes 3M a blue-chip stock to watch in 2024.
Altria Group Inc. (MO)
Sector: Consumer staples Market cap: $90.7 billion Dividend yield: 7.6%
Back in 2007, tobacco giant Altria Group announced the spinoff of its overseas brand portfolio into Philip Morris International Inc. (PM) to keep its U.S. business laser-focused on the domestic market. That decision has paid off big time, as evidenced by the total return for MO stock when you include dividends. Specifically, if you invested $10,000 immediately after that spin-off, which was finalized in March 2008, you’d have more than $65,000 by Christmas 2024, representing an annual rate of return of nearly 12% across that time frame. Altria has logged more than 50 consecutive years of dividend increases, with a generous payout that is currently about six times the average S&P 500 dividend stock. Sure, tobacco is unhealthy and breakneck growth isn’t likely for Altria. That said, this blue-chip stock’s share price has paced the broader market across 2024 to prove it can keep up. MO remains one of the most reliable long-term investments out there.
AT&T Inc. (T)
Sector: Communication services Market cap: $164 billion Dividend yield: 4.9%
Telecommunications leader AT&T has been reshaping its business over the past few years to adapt to the demands of the modern economy. That began with a restructuring in 2022 to streamline operations, jettison its ill-advised focus on media by spinning off its stake in Warner Bros. Discovery Inc. (WBD), and invest heavily in faster internet speeds through a fiber optics network and its 5G internet services. Thanks in part to lower interest rates that have reduced the cost of borrowing for these efforts, AT&T seems to be winning over investors, as T shares have gained 45% year to date. As for income potential, T’s 28-cent-per-share dividend remains only about half of its earnings — an encouraging sign that the generous payouts are sustainable and perhaps ready for additional increases in 2025.
Corning Inc. (GLW)
Sector: Technology Market cap: $41 billion Dividend yield: 2.4%
Corning traces its roots back to 1851 as a specialty glass and ceramics company. Nowadays, the company’s display segment produces everything from flat-panel monitors to screens for tablets, smartphones and other mobile devices. Separately, its optical communications segment provides fiber optic cables and related products to support high-speed data connections. There’s also plenty of other unsung gadgets and gear made by Corning, ranging from radiation shielding products to telescope lenses to cell culture media and labware. The expertise and manufacturing scale of Corning gives it a wide moat in a specialized field, making it a company that investors may want to rely on in the long term. This convergence of high-tech growth potential along with a long history of dividend payments makes it a great blue-chip stock to buy for 2025.
Digital Realty Trust Inc. (DLR)
Sector: Real estate Market cap: $61 billion Dividend yield: 2.7%
Digital Realty is a company that hosts data centers and “co-location” services. It’s had a great 2024, with roughly 35% share price growth year to date. But unlike other high-octane cloud computing and tech companies, it functions as a middleman for the high-tech applications used by thousands of major businesses worldwide. Structured as a real estate investment trust, or REIT, the company follows a simple model of investing heavily in the physical assets that power data networks and then renting that server space to third parties. That creates reliable revenue and dividends that are hard to match in the tech sector. With more than 300 data centers worldwide and operations that span more than 25 countries, this is a company with both the scale and the expertise to cash in across 2025. And thanks to its unique model, this blue-chip stock is less exposed to the fashionable ups and downs of other tech stocks.
Gilead Sciences Inc. (GILD)
Sector: Health care Market cap: $117 billion Dividend yield: 3.3%
Health care stocks are typically sure-fire investments. That wasn’t the case in 2024 due to difficult year-over-year comparisons across the board, along with an environment that favors faster-growing alternatives in the tech sector. Consider that the iShares U.S. Healthcare ETF (IYH), one of the leading sector funds for blue-chip health care stocks, has gained a measly 4% in 2024, while the broader market tacked on almost 30%. But Gilead has been one of the “least bad” stocks in the sector thanks to its strong product pipeline and high-margin treatments for otherwise unserved patient populations. These include treatment of HIV/AIDS and unique forms of cancer. Admittedly, GILD shares are only up 15% or so in 2024, thanks to projections of single-digit revenue growth and fiscal year 2025 earnings forecasts only about 10% higher than the current year. But it ranks near the top of the pile for performance in an otherwise challenging period for health care — and if you’re looking beyond short-term headwinds to long-term stability, this pharmaceutical leader makes the cut.
Goldman Sachs Group Inc. (GS)
Sector: Financial services Market cap: $182 billion Dividend yield: 2.1%
Goldman Sachs has a bit of a reputation on Wall Street, including the infamous “vampire squid” moniker for its deep and almost unbreakable connections to the global economy. The stock had fallen out of favor for a while, in part thanks to the growth opportunities of flashy new tech stocks as well as general regulatory headwinds over the past decade. However, the election of Donald Trump to a second term as president could result in a more lenient approach to bank oversight — with GS as a huge beneficiary of that policy shift. And even if those changes don’t happen immediately, it’s hard to find a bigger name in investment banking. The firm just hit a new record by topping $3 trillion in assets under management this year, and it has both the scale and expertise to thrive in the new year.
International Business Machines Corp. (IBM)
Sector: Technology Market cap: $207 billion Dividend yield: 3%
IBM’s Watson software is a generative AI platform that has been ahead of its time, taking on human Jeopardy game show contestants way back in 2011. The company and its products have come a long way since then, and in 2024 Watson raked in $3 billion in orders — resulting in a roughly 40% jump for IBM shares in 2024. Yes, that trails far behind AI high-flyers like Nvidia Corp. (NVDA), but IBM is more fairly valued at less than four times revenue, while other tech stocks trade for multiples that are 20 or 30 times that measure. And while it’s perhaps not the flashiest of the Big Tech giants out there, IBM is a blue-chip stock that may be a bit safer if and when we see regulators continue to crack down on trillion-dollar leaders both in the U.S. and Europe next year.
Kinder Morgan Inc. (KMI)
Sector: Energy Market cap: $61 billion Dividend yield: 4.3%
Energy companies can be notoriously dependent on commodity prices, so it’s hard to have confidence in most energy stocks after oil prices have moved steadily lower from the high $80s in early 2024 to around $70 before Christmas. Kinder Morgan is not like integrated oil stocks or exploration firms, however, operating as a “midstream” oil and gas company that maintains some 79,000 miles of pipelines and 139 terminal facilities across the U.S. This more stable business model fuels consistent earnings as well as steady dividends. At the end of 2023, KMI closed a $1.8 billion acquisition of additional pipeline assets to expand its empire further, which bodes well for future dividends and operational stability of this massive energy player.
Southern Co. (SO)
Sector: Utilities Market cap: $91 billion Dividend yield: 3.5%
Southern Co. current ranks as the No. 2 regulated electric utility in the U.S. by market value behind only NextEra Energy Inc. (NEE). And with Big Tech ramping up electricity demand for intensive AI applications, utilities like SO are increasingly seeing growth instead of just the slow-and-steady performance that is typical for the sector. Southern Co. is uniquely positioned to benefit from this trend, with electricity and natural gas operations that range from Illinois to Tennessee to Georgia. Incorporated back in 1945, it now serves 9 million total customers in regions with growing populations and consistent demand. With a wide moat thanks to strong regulatory oversight and the high cost of running a utility, SO is a blue-chip stock that is a solid bet for 2025.
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10 Best Blue-Chip Stocks to Buy for 2025 originally appeared on usnews.com
Update 12/24/24: This story was previously published at an earlier date and has been updated with new information.
