Wednesday, September 21, 2011

Apple is Everyone’s Favorite Blue-Chip Stock — But Which Companies Come Next?

You just can't go wrong with Apple (NASDAQ: AAPL ) stock these days. Just
look at these recent returns: 50% gains for AAPL stock in the past year 120%
gains for AAPL in the past two years 190% gains for AAPL in the past three years
455% gains for AAPL in the past five years 4,600% gains for AAPL in the past 10
years Given the dominant nature of the gadget giant, the $12 billion in cash on
its balance sheet and its track record of innovation, it's easy to see why a
great many investors agree that Apple simply is the best stock out there. But if
you want diversification, you can't put every cent in Apple alone. Where else,
then, should you stash your cash? Even though there aren't a lot of other
growth options out there and certainly no large-caps that have the explosive
potential of Apple there are a handful of other blue-chip stocks that are
incredibly attractive buys. If you already own Apple and are looking for other
investments to fill out your portfolio, consider these picks as the second-best
stocks to buy right now behind the Silicon Valley superpower: McDonald's
McDonald's (NYSE: MCD ) isn't quite as dramatic as Apple when it comes to
stock performance. The company has "only" doubled since 2007 and "only"
tripled since 2005 compared with 330% gains since 2007 and 900% gains since
2005 for Apple. But you have to admit, those gains still are incredibly
impressive especially for a mammoth blue chip like McDonald's that is
dominant worldwide. Also worth consideration is the fact that, since 2007,
McDonald's has paid dividends totaling $9.26 per share. Since McDonald's
stock was trading around $45 four years ago, that means on top of doubling your
money via the share appreciation, you would have gotten back about 20% of your
initial investment via dividends alone. Or if you reinvested those funds, you
really could have supercharged your returns even more. Looking forward,
McDonald's shows no signs of slowing down. It has surpassed analysts'
expectations in

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