Top 5 Blue Chip Companies To Invest In 2014

Andrew Harrer/Bloomberg via Getty ImagesThe Dow Jones news ticker in Times Square, New York City. NEW YORK -- Investment bank Goldman Sachs Group (GS), credit-card company Visa (V), and footwear Nike (NKE) will join the blue chip Dow Jones industrial average (^DJI) Dow Jones industrial average, the index managers said Tuesday, in the biggest shake-up for the 30-stock average in nearly a decade. The three companies will replace Bank of America (BAC), Hewlett-Packard (HPQ) and Alcoa (AA), all lower-priced stocks that exert a lesser pull on the price-weighted index. The changes will be effective on Sept. 23, S&P Dow Jones Indices said in a statement. The average, first established in 1896, includes 30 stocks, but very little money is indexed to its performance, unlike the broader Standard & Poor's 500 (^GSPC) or other indexes. In addition, because it is weighted by price, companies that are smaller in value with higher prices have more influence on the average. "Wow, those are big changes," said Tim Ghriskey, chief investment officer of Solaris Group in Bedford Hills, N.Y. "The Dow is really an antiquated index. It is price-weighted, which makes no sense. But there are still are some people that pay attention to it, and some technicians, so it has an influence on some people." Google (GOOG) and other names were considered for inclusion but passed over because of high stock prices, David Blitzer, managing director and chairman of the S&P Index Committee, told CNBC. The index manager said the changes were prompted by the low stock price of the three companies slated for removal and a desire to diversify the make-up of the index. Alcoa, in particular, has been seen as a candidate for elimination for some time, as the stock's market value of $8.5 billion is easily the lowest in the average. It is the first three-for-three change to the index since April 8, 2004, when American International Group (AIG), Pfizer (PFE) and Verizon (VZ) replaced AT&T (T), Eastman Kodak and International Paper (IP).

Hot Dividend Companies To Own For 2015: Colgate-Palmolive Company(CL)

Colgate-Palmolive Company, together with its subsidiaries, manufactures and markets consumer products worldwide. It offers oral care products, including toothpaste, toothbrushes, and mouth rinses, as well as dental floss and pharmaceutical products for dentists and other oral health professionals; personal care products, such as liquid hand soap, shower gels, bar soaps, deodorants, antiperspirants, shampoos, and conditioners; and home care products comprising laundry and dishwashing detergents, fabric conditioners, household cleaners, bleaches, dishwashing liquids, and oil soaps. The company offers its oral, personal, and home care products under the Colgate Total, Colgate Max Fresh, Colgate 360 Advisors' Opinion:

• [By Ben Levisohn]

  Shares of Procter & Gamble have dropped 3.2% during the past 12 months, lagging Unilever’s (UL) 2.5% rise, Colgate-Palmolive’s (CL) 8.7% advance and Kimberly-Clark’s (KMB) 3.1% gain.

Top 5 Blue Chip Companies To Invest In 2014: Apple Inc.(AAPL)

Apple Inc., together with subsidiaries, designs, manufactures, and markets personal computers, mobile communication and media devices, and portable digital music players, as well as sells related software, services, peripherals, networking solutions, and third-party digital content and applications worldwide. The company sells its products worldwide through its online stores, retail stores, direct sales force, third-party wholesalers, resellers, and value-added resellers. In addition, it sells third-party Mac, iPhone, iPad, and iPod compatible products, including application software, printers, storage devices, speakers, headphones, and other accessories and peripherals through its online and retail stores; and digital content and applications through the iTunes Store. The company sells its products to consumer, small and mid-sized business, education, enterprise, government, and creative markets. As of September 25, 2010, it had 317 retail stores, including 233 stores in the United States and 84 stores internationally. The company, formerly known as Apple Computer, Inc., was founded in 1976 and is headquartered in Cupertino, California.

Advisors' Opinion:

• [By Doug Ehrman]

  In a court case that is unusual for Apple (NASDAQ: AAPL  ) in that it neither involves patents nor Samsung, a U.S. District Judge in New York will soon decide�if there is sufficient evidence to conclude that the iPad maker colluded with book publishers to change e-book prices and force Amazon to use an agency pricing model. While the government is not seeking financial damages, the case has significant value as a precedent, and could open the floodgates for further suits. The five publishers involved in the case have already settled.

• [By Sean Williams]

  Apple (NASDAQ: AAPL  ) set the stage for the market and tech sector by reporting its second-quarter results last night. The bottom-line figure topped Wall Street's estimate as Apple delivered 37.4 million iPhones and 19.5 million iPads during the quarter and increased its cash balance to a monstrous $145 billion. Further, the company boosted its share repurchase authorizations by 500% and raised its quarterly payout 15%. Still, its conservative third-quarter forecast fell short of estimates once again and the Street seems generally unimpressed with a suddenly giving Apple.

• [By Rick Munarriz]

  HP and Dell retained their top positions, and Dell actually saw year-over-year domestic improvement. Then we get to Apple (NASDAQ: AAPL  ) , where the Cupertino magic is running thin.

• [By Holly LaFon]

  Companies need to constantly innovate to provide better value for their customers. They need to communicate the value. Globally, consumers have been willing to pay up for healthier products that will benefit them longer term. There is a tremendous opportunity for businesses that are on a virtuous cycle working to provide better value for their customers all the time. Unilever has done a good job staying close to their customers and has outperformed P&G, in my opinion, in many foreign markets. P&G is not executing up to its full potential. They may need to reenergize brands through spinoffs. Apple (AAPL) exemplifies the positive result of a tenacious drive to provide a superior product for the customer.

Top 5 Blue Chip Companies To Invest In 2014: Philip Morris International Inc(PM)

Philip Morris International Inc., through its subsidiaries, engages in the manufacture and sale of cigarettes and other tobacco products in markets outside of the United States. Its international product brand line comprises Marlboro, Merit, Parliament, Virginia Slims, L&M, Chesterfield, Bond Street, Lark, Muratti, Next, Philip Morris, and Red & White. The company also offers its products under the A Mild, Dji Sam Soe, and A Hijau in Indonesia; Diana in Italy; Optima and Apollo-Soyuz in the Russian Federation; Morven Gold in Pakistan; Boston in Colombia; Belmont, Canadian Classics, and Number 7 in Canada; Best and Classic in Serbia; f6 in Germany; Delicados in Mexico; Assos in Greece; and Petra in the Czech Republic and Slovakia. It operates primarily in the European Union, Eastern Europe, the Middle East, Africa, Asia, Canada, and Latin America. The company is based in New York, New York.

Advisors' Opinion:

• [By GuruFocus]

  The decade low yield of tobacco stocks can be clearly seen from our new interactive charts, which are embedded below. The chart shows the dividend yield of three tobacco stocks: Reynolds American (RAI), Philip Morris International (PM) and British American Tobacco (BTI).

• [By Dividend Growth Investor]

  Altria Group (MO) was able to spin-off its Kraft Foods division in 2007. Shareholders in Altria received shares in Kraft for each share of Altria stock they held. In 2008, this was followed by the spin-off of Phillip Morris International (PM), which represented the international tobacco business of Altria Group.

• [By Jonas Elmerraji]

  As the world's second largest tobacco company, Philip Morris International (PM) is the prototypical sin stock. It boasts recognizable brands, a sticky customer base, and a hefty dividend payout -- and the payout looks due for a dividend hike. As I write, Philip Morris International currently pays out a 85 cents each quarter, adding up to a 4.05% yield.

  Philip Morris owns almost 30% of the world's tobacco market. And much of that success is thanks to a single iconic brand: Marlboro. The firm has owned Marlboro (as well as second-tier names such as L&M and Parliament) internationally ever since Altria (MO) split up its international and domestic operations. Between the two markets, PM owns the more attractive franchise by far. After all, the international market is the only one that's actually growing.

  While the U.S. market for tobacco products is rife with regulation and demographic shifts are turning away from smoking, international tobacco sales are up -- especially in emerging markets. Premium positioning in markets like India, China and Indonesia translates into substantial cash flows for PM investors. And while the strength of the dollar has been a challenge post-2008, the potential for a Fed taper could strengthen this stock's payout in 2013.

Top 5 Blue Chip Companies To Invest In 2014: Chevron Corporation(CVX)

Chevron Corporation, through its subsidiaries, engages in petroleum, chemicals, mining, power generation, and energy operations worldwide. It operates in two segments, Upstream and Downstream. The Upstream segment involves in the exploration, development, and production of crude oil and natural gas; processing, liquefaction, transportation, and regasification associated with liquefied natural gas; transportation of crude oil through pipelines; and transportation, storage, and marketing of natural gas, as well as holds interest in a gas-to-liquids project. The Downstream segment engages in the refining of crude oil into petroleum products; marketing of crude oil and refined products primarily under the Chevron, Texaco, and Caltex brand names; transportation of crude oil and refined products by pipeline, marine vessel, motor equipment, and rail car; and manufacture and marketing of commodity petrochemicals, plastics for industrial uses, and fuel and lubricant additives. It a lso produces and markets coal and molybdenum; and holds interests in 13 power assets with a total operating capacity of approximately 3,100 megawatts, as well as involves in cash management and debt financing activities, insurance operations, real estate activities, energy services, and alternative fuels and technology business. Chevron Corporation has a joint venture agreement with China National Petroleum Corporation. The company was formerly known as ChevronTexaco Corp. and changed its name to Chevron Corporation in May 2005. Chevron Corporation was founded in 1879 and is based in San Ramon, California.

Advisors' Opinion:

• [By Dimitra DeFotis]

  Adams’ partial list of potential losers:

  BP (BP) : the highest profile potential loser. It owns 19.75% of Russian energy giant Rosneft, which accounted a third of�BP�� production in the fourth quarter. Sanctions that inhibit oil and gas flows to Europe, or banking/capital flows, would “hit Rosneft and BP early and hard.” An offset: there could be an uptick in demand for a pipeline 30% owned and operated by BP because it transports Azerbaijan oil through Georgia and Turkey to the Mediterranean ��a southern route avoiding Georgia and Ukraine. Chevron (CVX) pipeline investments could be stymied. It also�signed a 50-year agreement to explore for and develop oil and gas in western Ukraine, involving up to $10 billion of investment. “A Russian takeover spikes that deal,” Adams says. Oilfield services companies Halliburton (HAL), Baker Hughes (BHI), and Weatherford International�(WFT) all do business in Russia that could be prohibited if it is labeled a rogue nation.

  The crisis in Ukraine and Russia’s tactics make U.S. assets look more secure and more valuable: some U.S. refiners that could export fuel, utility holding companies that could export liquefied natural gas, and related pipeline companies could see even more benefits, longer-term, �from the North American fracking and horizontal drilling boom. But approval of the TransCanada (TRP) Keystone XL pipeline is a necessary piece of that equation, Adams writes.