Blue Chip Stocks
Blue chip stocks are big, well-established, dividend-paying corporations with strong business prospects. These are companies that also have sound management that should be able to make the right moves to keep competing successfully in a changing marketplace.

The root of the term “blue chip” stems from the game of poker, as the blue chips represent the highest value. Investing in blue chip stocks can give you an additional measure of safety in today’s turbulent markets.

Pat McKeough believes investors will profit most, and with the least amount of risk, by putting the bulk of your stock portfolio in shares of blue chip companies—those that are well-established, with strong balance sheets and steady earnings and cash flow. These are companies that have bright prospects in healthy and growing industries.

The best blue chips offer both capital gains growth potential and regular dividend income. The dividend yield is certainly one of the most concrete indicators of a sound investment. It is the percentage you get when you divide the current yearly dividend payment by the share or unit price of the investment. It’s an indicator we pay especially close attention to when we select stocks to recommend in our investment newsletters.

We feel most investors should hold the largest part of their investment portfolios in securities from blue chip companies. All these stocks should offer good “value”—that is, they should trade at reasonable multiples of earnings, cash flow, book value and so on. Ideally, they should also have above average-growth prospects in expanding markets.

Meanwhile, when investing in any type of stock, at TSI Network we recommend using our three-part Successful Investor strategy:

1-Invest mainly in well-established companies;

2-Spread your money out across most if not all of the five main economic sectors (Manufacturing & Industry; Resources & Commodities; Consumer; Finance; Utilities);

3-Downplay or avoid stocks in the broker/media limelight.

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As pipeline capacity lags, CN ships more oil
Blue Chip Stocks
As pipeline capacity lags, CN ships more oil
As pipeline capacity lags, CN ships more oil
CANADIAN NATIONAL RAILWAY CO. (Toronto symbol CNR; www.cn.ca) operates Canada’s largest railway. Its 32,350-kilometre network stretches across the country and through the U.S. Midwest to the Gulf of Mexico....
2 min read
Pat McKeough
GE shrinks financial services to cut risk
Blue Chip Stocks
GE shrinks financial services to cut risk
GE shrinks financial services to cut risk
GENERAL ELECTRIC CO. (New York symbol GE; www.ge.com) continues to shrink its GE Capital subsidiary, which provides loans and other financial services to buyers of its industrial products, such as power-transmission gear, jet engines and locomotives....
2 min read
Pat McKeough
Blue Chip Stocks
Blue Chip Stocks
Improved efficiency is keeping our 2012 Stock of the Year rising
Improved efficiency is keeping our 2012 Stock of the Year rising
In choosing a Stock of the Year, we aim for a “heads you win, tails you break even” situation. These stocks can put on above-average rises, but they’re unlikely to be disasters if they disappoint....
2 min read
Pat McKeough
Royal Bank expects Ally Financial to be a good fit
Blue Chip Stocks
Royal Bank expects Ally Financial to be a good fit
Royal Bank expects Ally Financial to be a good fit
ROYAL BANK OF CANADA (Toronto symbol RY; www.rbc.com) is Canada’s largest bank, with $867.5 billion of assets. Royal recently paid $3.7 billion for Ally Financial’s Canadian operations. This business mainly provides car loans through over 1,600 dealerships across the country. It also offers no-fee savings accounts and consumer and business loans....
2 min read
Pat McKeough
Blue Chip Stocks
Blue Chip Stocks
CP Rail slides on sale of shares by activist investor Pershing
CP Rail slides on sale of shares by activist investor Pershing
CANADIAN PACIFIC RAILWAY LTD. (Toronto symbol CP; www.cpr.ca) fell almost 7% this week after activist investor Pershing Square Capital Management L.P. announced that it will sell 7 million of its CP shares over the next year. Pershing currently holds 24 million CP shares, or 14.2% of the total outstanding. In June 2012, Pershing helped install Hunter Harrison as CP’s chief executive officer. Mr. Harrison is the former CEO of Canadian National Railway Co. (Toronto symbol CNR)....
2 min read
Pat McKeough
BCE aims to win approval for Astral Media deal
Blue Chip Stocks
BCE aims to win approval for Astral Media deal
BCE aims to win approval for Astral Media deal
BCE INC. (Toronto symbol BCE; www.bce.ca) is Canada’s largest provider of telephone, Internet and wireless services. It also sells satellite TV services across the country. The company continues to benefit from strong demand for wireless and high-speed Internet services. That’s a big reason why the stock is up 31% since 2008....
2 min read
Pat McKeough
Canadian insurance giants aim for rising sales in Asia, less risk in U.S.
Blue Chip Stocks
Another dividend hike for two Canadian utilities
Another dividend hike for two Canadian utilities
Low interest rates continue to spur demand for dividend-paying stocks, such as these two electrical utilities. In the latest issue of The Successful Investor we examine the outlook for each of these Canadian dividend stocks. Both of these companies plan to split their shares on a 2-for-1 basis in May 2013. CANADIAN UTILITIES LTD. (Toronto symbols CU [class A non-voting] and CU.X [class B voting]; www.canadianutilities.com) distributes electricity and natural gas in Alberta. It also operates 18 power plants in Canada, Australia and the U.K. ATCO Ltd. (see below) owns 52.9% of the company....
3 min read
Pat McKeough
Investment Toolkit: How to improve your chances of getting rich with your own business
Blue Chip Stocks
Irish Life is a big acquisition for Great-West Lifeco
Irish Life is a big acquisition for Great-West Lifeco
GREAT-WEST LIFECO (Toronto symbol GWO; www.greatwestlifeco.com) is Canada’s largest insurance company, with $545.8 billion in assets under administration. It recently agreed to buy Irish Life Group Ltd., Ireland’s largest pension manager and life insurance provider....
2 min read
Pat McKeough
Blue Chip Stocks - Free Report image
Blue Chip Stocks
How to find the true blue chip stocks—our new free report
Blue Chip Stocks - Free Report image
The New York Stock Exchange defines a blue chip as stock in a company with a national reputation for quality, reliability and the ability to operate profitably in good times and bad. The problem is that “reputation” plays a key role in the definition. Many companies acquire a blue-chip reputation by displaying the qualities that the definition suggests. Others get it through a strong public relations effort or by being in the right industry or business situation at the right time and place. Regardless of how it got there, this blue-chip label sticks with companies long after they quit living up to it....
2 min read
Pat McKeough
Blue Chip Stocks: GE's Fairfield Campus image
Blue Chip Stocks
Blue chip stocks: GE strives to sustain its recovery
Blue Chip Stocks: GE's Fairfield Campus image
The ability to weather a crisis is one of the distinguishing characteristics of the blue chip stocks we recommend. This multinational, one of the last survivors of the original 12 Dow Jones stocks of 1896, suffered a sharp setback during the financial crisis of 2008-2009. But its deep resources and diverse industrial base have allowed it to stage a recovery. General Electric Co. (New York symbol GE; www.ge.com) is one of the world’s largest manufacturers. It makes equipment for generating and distributing electricity, such as turbines (31% of revenue, 32% of earnings); aircraft engines (13%, 17%); health care equipment, such as medical scanners (13%, 14%); home appliances and lighting (6%, 1%); and locomotives (3%, 4%)....
2 min read
Pat McKeough
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