In this article, we will look at 10 low-price blue-chip stocks to buy now.
We are halfway into 2022, and what at first was a stock market recovering from pandemic-related aftershocks, is now being beaten down to its core with interest rate hikes, steeply rising inflation, and a slowing global economy. So far, the S&P 500 is down by 23.39% as of June 17, and the stock market has officially entered the bear market territory according to financial experts. Inflation is reaching historic highs, with the CPI for all urban consumers rising by 8.6% year over year in May 2022, running at a 40-year high. In order to combat this, the Fed issued its latest rate hike on June 15 and increased its benchmark rate by 75 basis points, the highest increase since 1994.
Investors are reorganizing their portfolios to hedge against inflation and are preparing themselves for a possible recession. Although typically, investors are bullish on growth stocks and pile huge sums into tech blue-chip companies like Microsoft Corporation (NASDAQ:MSFT), Amazon.com, Inc. (NASDAQ:AMZN), and Alphabet Inc. (NASDAQ:GOOG), right now some of them are exiting their positions in such companies and the tech sector is suffering major losses as part of the selloff that started in May 2022. As of June 17, the tech-heavy Nasdaq Composite index is down 31.80%.
The average investor does not have access to huge sums of money that veteran investors and hedge funds have, which is why we devised this list of 10 low-priced blue-chip stocks to buy now. These stocks come from sectors that have a proven track record of remaining resilient to inflation. Some of the winning sectors during inflationary periods include consumer staples, energy, materials, and utilities.
Our Methodology
To determine the 10 low-priced blue-chip stocks to buy now, we looked for blue-chip companies that are currently trading below $50. We then looked for other features that can be beneficial for investors in volatile and inflationary times, which is why most of the companies ranked on this list are dividend payers or undervalued, or both. We have ranked these stocks in increasing order of hedge fund holders, and have included the analyst rating for each stock pick as well.
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Low-Price Blue Chip Stocks to Buy Now
10. The Andersons, Inc. (NASDAQ:ANDE)
Number of Hedge Fund Holders: 16
Share Price as of June 17: $33.81
The Andersons, Inc. (NASDAQ:ANDE) operates as an agriculture company, in the United States and internationally, through three primary segments: trade, renewables, and plant nutrients. At the close of Q1 2022, 16 hedge funds were long The Andersons, Inc. (NASDAQ:ANDE) with stakes worth $53.76 million. This is compared to 15 positions in the previous quarter with stakes worth $31.79 million. The hedge fund sentiment for the stock is positive.
The Andersons, Inc. (NASDAQ:ANDE) is one of the best low-priced blue-chip stocks to buy now because of the company’s undervalued nature and rich dividend history. As of June 17, The Andersons, Inc. (NASDAQ:ANDE) has a forward PE ratio of 12.71 and a dividend yield of 2.13%. The company has been growing its dividends for the past 15 years. On June 16, The Andersons, Inc. (NASDAQ:ANDE) declared a quarterly cash dividend of $0.18 per share. The common stock cash dividend is payable on July 22 to investors of record on July 1.
As of this May, BMO Capital analyst Kenneth Zaslow has a $45 price target and a Market Perform rating on The Andersons, Inc. (NASDAQ:ANDE).
As of March 31, Arrowstreet Capital is the top stakeholder in The Anderson’s, Inc. (NASDAQ:ANDE). In the first quarter of 2022, Arrowstreet Capital raised its stakes in the company by 4%, bringing them to $18.84 million.
The Anderson’s, Inc. (NASDAQ:ANDE) is managing to hold up against the steeply growing inflation in 2022 and is therefore a budget-friendly blue-chip stock to buy now. While tech blue-chip stocks like Microsoft Corporation (NASDAQ:MSFT), Amazon.com, Inc. (NASDAQ:AMZN), and Alphabet Inc. (NASDAQ:GOOG) are facing near-term headwinds and suffering from sell-offs, they are the best bets for the long-term.
9. Enterprise Products Partners L.P. (NYSE:EPD)
Number of Hedge Fund Holders: 19
Share Price as of June 17: $23.45
Enterprise Products Partners L.P. (NYSE:EPD) provides midstream energy services to producers and consumers of natural gas, natural gas liquids, crude oil, petrochemicals, and refined products. The company is undervalued and also a dividend payer. As of June 17, Enterprise Products Partners L.P. (NYSE:EPD) has a forward PE ratio of 9.49 and a forward dividend yield of 7.93%. The company has been consistent with growing its dividends for the past 23 years.
On May 2, Enterprise Products Partners L.P. (NYSE:EPD) announced earnings for the fiscal first quarter of 2022. The company reported earnings per share of $0.60 and beat expectations by $0.07. The company’s revenue came in at $13.01 billion, up 42.08% year over year, ahead of expectations by $2.54 billion. As of June 17, Enterprise Products Partners L.P. (NYSE:EPD) has returned 13.12% to investors over the past six months.
Shortly after the company’s earnings release, Truist analyst Neal Dingmann raised his price target on Enterprise Products Partners L.P. (NYSE:EPD) to $30 from $27 and reiterated a Buy rating on the shares.
At the close of Q1 2022, 19 hedge funds disclosed ownership of stakes in Enterprise Products Partners L.P. (NYSE:EPD). These funds held collective stakes of $177.51 million in the company. Of these, $84.54 million were of First Eagle Investment Management, the largest shareholder in the company.
8. Flowers Foods, Inc. (NYSE:FLO)
Number of Hedge Fund Holders: 25
Share Price as of June 17: $24.67
Flowers Foods, Inc. (NYSE:FLO) produces and markets packaged bakery products in the United States. On May 26, Flowers Foods, Inc. (NYSE:FLO) increased its share repurchase authorization by 20 million shares. Previously, at the end of the first quarter of 2022, 5.4 million shares of the company remained under the existing authorization. Now, the current authorization has been extended to 25.4 million shares, with no expiration date. Flowers Foods, Inc. (NYSE:FLO) also hiked its dividend to $0.22 per share, up 4.8% from its prior dividend of $0.21. The dividend is payable on June 23, to investors of record on June 9.
Flowers Foods, Inc. (NYSE:FLO) is one of the best low-budget blue-chip companies to invest in right now because of the company’s dividend capacity and strong balance sheets. This May, the company released earnings for the fiscal first quarter of 2022 in which it beat both EPS and revenue estimates. Flowers Foods, Inc. (NYSE:FLO) registered an EPS of $0.44, ahead of expectations by $0.05. Moreover, the company generated a revenue of $1.44 billion, up 10.27% year over year, and outperformed Wall Street consensus by $31.19 million. As of June 17, the stock has gained 3.96% over the past twelve months and has a forward dividend yield of 3.57%.
On May 23, Deutsche Bank analyst Steve Powers cut his price target on Flowers Foods, Inc. (NYSE:FLO) to $26 from $27 and reiterated a Hold rating on the shares.
At the end of Q1 2022, 25 hedge funds were bullish on Flowers Foods, Inc. (NYSE:FLO) with stakes worth $317.91 million. This is compared to 20 positions in the previous quarter with stakes worth $276.99 million. The hedge fund sentiment for the stock is positive.
In Q1 2022, Renaissance Technologies raised its stakes in Flowers Foods, Inc. (NYSE:FLO) by 9%, bringing them to $154.25 million. Renaissance Technologies is the top shareholder in the company.
7. PPL Corporation (NYSE:PPL)
Number of Hedge Fund Holders: 26
Share Price as of June 17: $25.36
PPL Corporation (NYSE:PPL) delivers electricity and natural gas in the United States and the United Kingdom. The company operates through two segments: Kentucky Regulated and Pennsylvania Regulated. This May, Goldman Sachs analyst Michael Lapides reinstated coverage of PPL Corporation (NYSE:PPL) with a Buy rating and a $34 price target. Lapides cited the company’s solid dividend growth and balance sheet capacity while recommending the stock to investors that are income and defense-oriented.
On June 9, PPL Corporation raised its quarterly cash dividend to $0.225 per share, up 12.5% from its prior dividend of $0.20 per share. The dividend is payable on July 1 to shareholders of record on June 21. As of June 17, PPL Corporation (NYSE:PPL) has a forward dividend yield of 3.55%. PPL Corporation (NYSE:PPL) is a budget-friendly utility blue-chip stock to invest in because of the company’s dividend-paying capabilities and strong balance sheets.
Insider Monkey found 26 hedge funds bullish on PPL Corporation (NYSE:PPL) at the close of Q1 2022. The total stakes of these hedge funds were valued at $565.66 million, up from $173.14 million in the prior quarter with 17 positions. The hedge fund sentiment for the stock is positive.
In the first quarter of 2022, Zimmer Partners initiated a position in PPL Corporation (NYSE:PPL) and purchased more than 6.78 million shares of the company. Zimmer Partners is the leading shareholder in PPL Corporation (NYSE:PPL) as of March 31 and has stakes worth $193.80 million in the company.
Unlike tech blue-chips such as Microsoft Corporation (NASDAQ:MSFT), Amazon.com, Inc. (NASDAQ:AMZN), and Alphabet Inc. (NASDAQ:GOOG), PPL Corporation (NYSE:PPL) is a blue-chip stock to buy now amidst a rising inflationary environment.
6. Hormel Foods Corporation (NYSE:HRL)
Number of Hedge Fund Holders: 30
Share Price as of June 17: $44.69
Hormel Foods Corporation (NYSE:HRL) develops, processes, and distributes a variety of food products to retail, foodservice, deli, and commercial customers in the United States and internationally. As of March 10, Argus analyst John Staszak has a Buy rating and a $57 price target on Hormel Foods Corporation (NYSE:HRL).
Hormel Foods Corporation (NYSE:HRL) has managed to maintain consumer demand for its products as can be reflected in the company’s earnings. On June 2, Hormel Foods Corporation (NYSE:HRL) announced earnings for the second quarter of fiscal year 2022. The company registered an EPS of $0.48, ahead of expectations by $0.01. Moreover, the company’s revenue for the quarter came in at $3.10 billion, up 18.80% year over year, and beat revenue expectations by $27.76 million. As of June 17, the stock has a forward dividend yield of 2.33%.
Strong balance sheets and dividend yield make Hormel Foods Corporation (NYSE:HRL) a suitable investment option for investors exploring budget-friendly blue-chip stocks.
At the end of the first quarter of 2022, 30 hedge funds held stakes in Hormel Foods Corporation (NYSE:HRL) worth $501.96 million.
Here is what LRT Capital Management had to say about Hormel Foods Corporation (NYSE:HRL) in its third-quarter 2021 investor letter:
“Hormel Foods Corporation (HRL) – the maker of SPAM and Applegate Turkey (among many other products), is down over 20% since peaking last year, largely on fears of higher cost. We expect the company will be able to raise prices to offset cost inflation as they have always been able to do win their past.”
5. UGI Corporation (NYSE:UGI)
Number of Hedge Fund Holders: 30
Share Price as of June 17: $37.65
UGI Corporation (NYSE:UGI) operates as a gas utility company that distributes, stores, transports, and markets energy products and related services in the United States and internationally. The company operates through four segments: AmeriGas Propane, UGI International, Midstream & Marketing, and UGI Utilities. UGI Corporation (NYSE:UGI) is one of the best low-priced blue-chip companies to invest in because it is undervalued, pays dividends, and is well-positioned to benefit from rising gas prices.
On May 4, UGI Corporation (NYSE:UGI) announced that its board of directors have declared a quarterly cash dividend of $0.36 per share, up 4.3% from its prior dividend of $0.345. The dividend is payable on July 1 to investors of record on June 15. As of June 17, UGI Corporation (NYSE:UGI) has a forward PE ratio of 12.89, and a dividend yield of 3.82%. The company has been consistent with growing its dividends for the past 19 years and has a 5-year dividend CAGR of 7.70%.
As of March 22, Barclays analyst Christine Cho has a $40 price target and an Equal Weight rating on UGI Corporation (NYSE:UGI).
At the end of Q1 2022, 30 hedge funds disclosed ownership of stakes in UGI Corporation (NYSE:UGI). These stakes were worth $241.76 million, up from $167.25 million in the preceding quarter with 31 positions.
As of March 31, First Eagle Investment Management is the leading shareholder in UGI Corporation (NYSE:UGI), owning over 8.58 million shares of the company.
4. The Kroger Co. (NYSE:KR)
Number of Hedge Fund Holders: 45
Share Price as of June 17: $46.20
The Kroger Co. (NYSE:KR) operates a variety of food and drug stores, multi-department stores, marketplace stores, and price impact warehouses throughout the United States. On June 17, Morgan Stanley analyst Simeon Gutman raised his price target on The Kroger Co. (NYSE:KR) to $41 from $38 and reiterated an Underweight rating on the shares.
Two features that made The Kroger Co. (NYSE:KR) rank high among low-priced blue-chip stocks to invest in now are the company’s undervalued nature and dividend yield. As of June 17, the stock has a forward PE ratio of 11.87 and a dividend yield of 1.82%.
At the end of Q1 2022, 45 hedge funds held stakes in The Kroger Co. (NYSE:KR) worth $5.16 billion. This is compared to 41 positions in the prior quarter with stakes worth $4.15 billion. The hedge fund sentiment for the stock is positive.
As of March 31, Berkshire Hathaway is the top stakeholder in The Kroger Co. (NYSE:KR), with stakes worth $3.32 billion.
3. Altria Group, Inc. (NYSE:MO)
Number of Hedge Fund Holders: 47
Share Price as of June 17: $45.31
Altria Group, Inc. (NYSE:MO) manufactures and sells smokable and oral tobacco products in the United States. The company is most famous for its Marlboro brand. As of April 29, Deutsche Bank analyst Steve Powers has a $60 price target and Buy rating on Altria Group, Inc. (NYSE:MO).
As of June 17, Altria Group, Inc. (NYSE:MO) has a forward dividend yield of 7.95% and a price-to-earnings ratio of 9.34, which makes it an undervalued dividend blue-chip stock to invest in. The company has been paying out dividends to investors for the past 18 years and has a 5-year dividend CAGR of 8.09%.
On May 19, Altria Group, Inc. (NYSE:MO) declared a quarterly cash dividend of $0.90 per share, in-line with the previous. The dividend is payable on July 11 to shareholders of record on June 15.
At the end of Q1 2022, 47 hedge funds were long Altria Group, Inc. (NYSE:MO) with stakes worth $1.95 billion. This is compared to 39 positions in Q4 2021 with stakes worth $1.05 billion. The hedge fund sentiment for the stock is positive.
In the first quarter of 2022, GQG Partners raised its stakes in Altria Group, Inc. (NYSE:MO) by 100%, bringing them to $956.22 million. GQG Partners is the dominating shareholder in the company as of March 31, 2022.
2. AT&T Inc. (NYSE:T)
Number of Hedge Fund Holders: 74
Share Price as of June 17: $19.38
Analysts are recommending AT&T Inc. (NYSE:T) to investors in order to recession-proof their portfolios. On June 14, Wells Fargo unveiled its recession stock portfolio, a part of which was AT&T Inc. (NYSE:T). The stock was also named among the “15 stocks that can weather a bear market” by Morgan Stanley on May 23. Moreover, this June, Tigress Financial analyst Ivan Feinseth maintained a Buy rating on the shares. The analyst sees the company’s “resilient” business model and growing consumer base to drive increased cash flow and long-term shareholder returns.
AT&T Inc. (NYSE:T) is among the best budget-friendly blue-chip stock options to consider because, at current levels, the stock is undervalued and moreover, is paying dividends. As of June 17, AT&T Inc. (NYSE:T) has a forward PE ratio of 7.55 and a dividend yield of 5.73%.
At the close of Q1 2022, 74 hedge funds disclosed ownership of stakes in AT&T Inc. (NYSE:T). The total value of these stakes came in at $4.0 billion. Of these, Arrowstreet Capital was the most bullish hedge fund on the stock with stakes worth $678.54 million.
Here is what Weitz Investment Management had to say about AT&T Inc. (NYSE:T) in its “Hickory Fund” fourth-quarter 2021 investor letter:
“After several quarters of pandemic-induced outsized growth, new broadband connection growth has slowed for U.S. cable operators. This slower growth has coincided with a renewed push by competitors like Verizon and AT&T Inc. (NYSE:T) to offer high-speed data (either via wireless connects or by building new fiber-optic networks).”
1. Comcast Corporation (NASDAQ:CMCSA)
Number of Hedge Fund Holders: 78
Share Price as of June 17: $38.71
On April 28, Comcast Corporation (NASDAQ:CMCSA) reported market-beating earnings for the fiscal first quarter of 2022. The company registered an EPS of $0.86, ahead of expectations by $0.05. Moreover, the company’s revenue for the quarter came in at $31.01 billion, up 13.99% year over year, and exceeded Wall Street expectations by $602.53 million.
Comcast Corporation (NASDAQ:CMCSA) made it to Wells Fargo’s recession stock portfolio. Morgan Stanley analysts are also bullish on Comcast Corporation (NASDAQ:CMCSA) and named the stock among their top 15 picks that can weather a bear market. Moreover, on June 2, Benchmark analyst Matthew Harrigan lowered his price target on Comcast Corporation (NASDAQ:CMCSA) to $60 from $65 but reiterated a Buy rating on the shares. The analyst noted that he cut his price target on Comcast Corporation (NASDAQ:CMCSA) to reflect tightening market conditions.
Comcast Corporation (NASDAQ:CMCSA) is an undervalued blue-chip play, with the added advantage of dividends. As of June 17, Comcast Corporation (NASDAQ:CMCSA) has a forward PE ratio of 10.76 and a dividend yield of 2.79%.
At the end of Q1 2022, 78 hedge funds were long Comcast Corporation (NASDAQ:CMCSA) with stakes worth $7.12 billion. Of these, First Eagle Investment Management held the majority stakes and was the top shareholder in the company. As of March 31, First Eagle Investment Management’s stakes in Comcast Corporation (NASDAQ:CMCSA) are valued at $1.40 billion, up 3% from its Q4 2021 stakes.
ClearBridge Investments mentioned Comcast Corporation (NASDAQ:CMCSA) in its “All Cap Growth Strategy” fourth-quarter 2021 investor letter. Here is what the firm said:
“Weakness among our holdings in the communication services sector was the other detractor to performance. Comcast was hurt by tepid subscriber growth in its broadband business but demonstrated strong growth in free cash flow, positioning the company for accelerated capital return going forward.”
You can also take a look at 10 Growth Stocks Under $50 for 2022 and 10 Blue Chip Stocks with Dividends.
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- 11 Best High Dividend Stocks Under $50
Disclose. None. 10 Low-Price Blue Chip Stocks to Buy Now is originally published on Insider Monkey.
