Blue-chip stocks, which come from large, well-established and financially sound companies, hold clear appeal for investors, Margaret Giles, a senior editor for content development at Morningstar, wrote in a blog post this week.
These companies have strong brand names and reputations and generate dependable earnings. And blue chips are often considered less risky, thanks to their financial stability.
Giles noted, however, that investors have varying expectations of blue-chip companies. Some demand that the stock be included in a particular index, while others include only dividend-paying companies on their blue-chip lists. Still others set specific market-cap thresholds for blue-chip companies.
At Morningstar, Giles wrote, the best blue-chip stocks to buy for the long term have several qualities in common.
They come from companies that Morningstar includes on its list of the Best Companies to Own for 2026. These companies have wide Morningstar economic moat ratings and predictable cash flows, and are managed by teams that make smart capital-allocation decisions.
Companies on the list have market caps of more than $100 billion, and are undervalued as measured by Morningstar's price/fair value metric.
See the gallery for the 10 best undervalued blue chips to buy for the long term. One-year returns are as of Jan. 28. The stocks are ranked by their price-to-fair-value ratio.
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