7 blue-chip stocks to buy at historic lows

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While this year’s anxiety-fueled downturn has generated attractive discounts for speculators, the contrarian buying opportunity among blue-chip stocks is arguably the most enticing. Indeed, several of the alpha dogs are suffering massive losses – perhaps to an unprecedented degree. Such a circumstance gives patient investors unprecedented access to quality ideas.

Yes, you can still search for popular names such as meme swaps and other flavors of the week. However, with a myriad of blue-chip stocks to buy having suffered deep double-digit losses in the year so far, even the most conservative investor should at least consider buying a few stocks. After all, companies with the largest market capitalizations have earned the premium through years of trading success.

Therefore, the concept of buying blue chip stocks in these volatile times is less about speculation and more about taking advantage of what the market is giving you. Don’t get me wrong, nothing in the capital markets is without risk. However, blue chips have a proven track record, and as a result, you acquire good companies suffering from lean business cycles.

Teleprinter Company Current price
NVDA Nvidia $186.22
INTU Intuitive $417.36
TGT Target $163.99
TTD Commercial counter $50.87
TWLO Twilio $103.92
DPZ Dominos Pizza $359.83
TSLA You’re here $743.78

Nvidia (NVDA)

One of the biggest names in the wider tech space, Nvidia (NASDAQ:NVDA) is currently undergoing a sudden reversal of fortune. Year-to-date, NVDA is down almost 40%. Typically, when a stock unit loses that much value in the market, there’s a reason for it – usually not a good one. Granted, red ink is a major distraction.

As you know, the semiconductor supply crisis has been the poster child for the global supply chain crisis. Additionally, the cryptocurrency market has crashed so far, imposing a headwind on one of Nvidia’s lucrative revenue streams: manufacturing processors specifically designed for crypto-mining operations. Added to this mess is galloping inflation, which squeezes consumer budgets.

Still, inflation, crypto fallout, and the supply chain crisis are temporary issues. This does not mean that they will leave tomorrow. This can take years to resolve. But at some point, a resolution will likely come. But, by then, NVDA could be down to its rightful premium, meaning it’s probably one of the best blue-chip stocks to buy right now.

Intuit (INTU)

A powerhouse in the business software industry, Intuitive (NASDAQ:INTU) is best known for its tax preparation solutions, including popular brands TurboTax and QuickBooks. Now I understand that for most people tax season is over. But that’s no reason why INTU is expected to be down 33% year-to-date.

One possible explanation for the dramatic red ink is the economic backdrop. With consumer sentiment hitting multi-year lows amid a number of companies announcing layoffs, the financial situation of many households looks grim. To put it cynically, people may not need to consider buying access to tax software because of the collective erosion of wages and income.

Yet, on a more optimistic note, Intuit could become one of the premier stocks to buy thanks to the booming gig economy. Projected to be a $455 billion market segment by 2023, Intuit is ready to serve new customers; keep in mind that independent contractors have a more complex tax profile than regular employees.

Target (TGT)

Target (NYSE:TGT) is down sharply, losing more than 29% since the start of the year. Of course, security wasn’t nearly as bad until recently when management disclosed its Q1 2022 results. Obviously the picture stinks.

Although revenue of $25.17 billion exceeded the consensus goal of $24.49 billion, Target fell sharply in terms of earnings per share, delivering $2.19 adjusted from the estimate of $3.07. Management explained the poor numbers, saying it was battling expensive freight costs, higher markdowns and lower-than-expected sales of discretionary items.

In other words, the Consumer Sentiment Index is not just a flawed statistic. People feel the pain and they close their wallets.

Nonetheless, Target’s saving grace is that it has strong appeal, unlike its rival walmart (NYSE:WMT), which has a less than ideal image. Additionally, Target caters to a wealthier shopper, offering them some insulation in the event of a recession.

Trade Office (TTD)

When the social media company Instantaneous (NYSE:INSTANTANEOUS) warned that he would probably not being able to meet their income and second-quarter earnings forecasts due to economic deterioration, Wall Street punished SNAP stock to an awful degree, losing 43% in the May 24 session. But like Commercial counter (NASDAQ:TTD) demonstrated, it was not the only victim.

Although TTD didn’t hurt as much, the pain was quite noticeable, dropping 18.5% on May 24, translating into outright bleeding nearly 43% year-to-date. Although the two are different companies (obviously), Snap’s disturbing disclosure had negative implications for digital media and advertising. As a leader in the programmatic advertising space, the potential industry headwind has rocked Trade Desk.

While not taking away the inherent risks, TTD could still make the case for buying blue chip stocks, as programmatic advertising could be the future of consumer engagement. Experts predict that the underlying market could grow at a compound annual growth rate of 13.7%, which could make TTD an attractive discount.

Twilio (TWLO)

One of the companies I didn’t give much credit to when it ascended, seems like I’m beating zero for two regarding Twilio (NYSE:TWLO). Previously, I talked about TWLO’s upsetting outlook. Unfortunately, the equity unit continues to head in the wrong direction, posting an astonishing 60% year-to-date loss. I should stop, but I’m going to show myself at least one more time.

As a specialist in communication APIs – or interfaces that facilitate the integration of voice calls, text messages and other forms of communication into a software application or product – Twilio is extremely relevant. With modern societies almost guaranteed to incorporate more scanning and automation protocols, Twilio almost seems like an obvious discount.

Additionally, I really appreciate the company’s two-factor authentication (2FA) system, which is relevant to the crypto investing community. Although no security protocol is 100% guaranteed, 2FA provides great peace of mind for those worried about cyberattacks.

Domino’s Pizza (DPZ)

In many cases, recessionary pressures help so-called vice stocks because their underlying commodities provide cheap entertainment or a form of escape from contemporary issues. This is the cynical case for Dominos Pizza (NYSE:DPZ). No, the company is not a culinary specialist. Instead, it provides comfort food at reasonable prices to hungry households, making it one of the most attractive blue chip titles to buy at a discount.

And what a discount it is. Despite Domino’s much-heralded corporate turnaround, DPZ this year doesn’t show much evidence of it, dropping 35% year-to-date. In my view, the skyrocketing rate of inflation is a significant detractor. Due to the associated erosion of purchasing power, cash-strapped people will look for ways to save money. Eating out will be an easy item to cross off the list.

Nevertheless, one can wonder if the sale is a bit too abrupt. Again, Domino’s has a bit of a vice appeal due to its addictive fast food business. Therefore, it could be one of the premier stocks to buy for forward-thinking speculators.

Tesla (TSLA)

One of the biggest gainers from the slump of 2020 – when stocks traded in double-digit territory – You’re here (NASDAQ:TSLA) defied critics, ultimately crossing into four-figure territory. The ride was simply remarkable. Unfortunately, what goes up must come down. As Tesla CEO Elon Musk learns, he can buy a lot of things but not control gravity.

But it’s not just the normal ebbs and flows of the market that impact TSLA. On the contrary, there are strong questions about the viability of electric vehicles, especially for the middle-income masses. On the one hand, EVs are still incredibly expensive and second, the necessary lithium extraction process that underpins the industry is taxing on the environment, especially the global water supply.

But what I love about Tesla from a cynical standpoint is that the products are aimed at a somewhat exclusive and generally affluent consumer base. I’m starting to doubt Tesla will ever be accessible to people on a regular income, but it might be fine. Exclusivity can generate social cachet, which could make TSLA one of the prime stocks to buy at a discount.

As of the date of publication, Josh Enomoto had no position (directly or indirectly) in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to InvestorPlace.com Publication guidelines.

A former senior business analyst for Sony Electronics, Josh Enomoto helped negotiate major contracts with Fortune Global 500 companies. Over the past several years, he has provided critical and unique insights to investment markets, as well as various other industries including law, construction management and healthcare.

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