10 Best Blue-Chip Stocks to Buy for the Long Term

Investors often hold

at the core of their portfolios. That makes sense. After all, blue-chip companies are leaders in their industries. Their names are familiar to investors.

What Are Blue-Chip Stocks?

Blue-chip stocks are from companies that are large, well-established, and financially sound. These companies have strong brand names and reputations, and they generate dependable earnings. Blue-chip companies usually boast consistent dividends and are often considered less risky, given their financial stability.

However, investors may differ in how they define blue-chip companies. Some investors demand that a blue-chip stock be included in a particular index, such as the Dow Jones Industrial Average. Others may include only dividend-paying companies on their lists of blue-chip stocks. Still others may have specific market-cap thresholds for blue-chip companies.

10 Best Blue-Chip Stocks to Buy for the Long Term

These are the largest firms by market cap on Morningstar’s Best Companies to Own list whose stocks were the most undervalued as of May 11, 2026.

1. SAP SAP
2. Danaher DHR
3. Amphenol APH
4. Sony Group SONY
5. Microsoft MSFT
6. Charles Schwab SCHW
7. Bank of America BAC
8. S&P Global SPGI
9. Bristol-Myers Squibb BMY
10. Lockheed Martin LMT

To come up with our list of the best blue-chip stocks to buy for the long term, we screened for:

• Stocks from companies included on Morningstar’s list of the Best Companies to Own. Companies on this list have wide

  Morningstar Economic Moat Ratings

  and predictable cash flows, and they are run by management teams that make smart capital-allocation decisions.

• Stocks that are undervalued, as measured by our price/fair value metric.
• Companies with market caps above $100 billion.

Here’s a little more about each of these blue-chip stocks for the long term, including commentary from the Morningstar analysts who cover each company. All data is as of May 11, 2026.

SAP

• Morningstar Price/Fair Value: 0.54
• Market Capitalization: $198.5 billion
• Morningstar Style Box: Large Growth
• Forward Dividend Yield: 1.72%
• Industry: Software – Application

Software application firm SAP is the most affordable stock on our list of the best blue-chip stocks to buy. Founded in Germany in 1972 by former IBM employees, SAP is the world’s largest provider of enterprise application software. The stock is trading 46% below our fair value estimate of $317 per share.

SAP is the world’s largest provider of enterprise application software and the global market leader in enterprise resource planning software. The company earns revenue by selling subscriptions for its various cloud-based software-as-a-service products as well as licenses and maintenance fees for on-premises software, which are now being largely phased out. Besides its core ERP products, such as S/4HANA, SAP offers well-known back-office software products such as Concur for travel and expense management and Ariba for procurement.

The company was late to the cloud for ERP software, but now offers two compelling products: RISE with SAP, which is the private-cloud edition designed for SAP’s large enterprise customers that are transitioning from their SAP on-premises ERP (ECC) to SAP S/4HANA; and GROW with SAP, which is the public cloud edition that is designed for midmarket companies with less complex requirements. We think GROW with SAP fills an important void in SAP’s product offering, as previously SAP’s ERP software was often unattractive to smaller customers, given the implementation costs were just too high. With the launch of these new products, cloud revenue is growing swiftly, and SAP is capturing many new midmarket customers.

SAP is following a land and expand strategy, which is common in the enterprise software market. RISE with SAP and GROW with SAP are the land products after which the company then upsells and cross-sells more SAP products to these customers, which is much easier in a cloud-based model. The company has yet to release its latest long-term ambitions but expects revenue growth to accelerate at least through 2027, along with rising margins as the cloud business reaches efficient scale.

Read more about SAP here.

Danaher

• Morningstar Price/Fair Value: 0.62
• Market Capitalization: $117.9 billion
• Morningstar Style Box: Large Value
• Forward Dividend Yield: 0.96%
• Industry: Diagnostics & Research

In 1984, Danaher’s founders transformed a real estate organization into an industrial-focused manufacturing company. This cheap stock looks 38% undervalued and has a fair value estimate of $270 per share.

Through its Danaher Business System, Danaher aims for continuous improvement of its scientific technology portfolio by seeking out attractive markets and then making acquisitions to enter or expand within those fields and also divesting assets that are no longer seen as core, such as the 2023 divestiture of Veralto, its environmental and applied solutions segment. After acquisitions, Danaher aims to accelerate core growth at acquired companies by making research and development and marketing-related investments. It also implements lean manufacturing principles and administrative cost controls to boost operating margins. Overall, we appreciate Danaher’s strategic moves, which have pushed it into attractive end markets with strong growth prospects and sticky, recurring revenue streams.

The company’s acquisition-focused strategy has contributed to its becoming a top-five player in the highly fragmented and relatively stable life sciences and diagnostic tool markets, approximately 20 years after its first acquisition in the space (Radiometer in 2004). Important life sciences and diagnostic acquisitions have included Beckman Coulter, Pall, and Cepheid. In early 2020, Danaher completed its largest acquisition, GE Biopharma, now known as Cytiva, which fills some gaps for Danaher within the biopharmaceutical development and manufacturing tool market. We find the drug manufacturing part of the life sciences market particularly attractive given its strong growth trajectory, high margins, and high switching costs associated with regulatory and reproducibility concerns of end users. Management is adding to its diagnostic tools, too, including the pending acquisition of Masimo and its industry-leading pulse oximetry tools, which is expected to close in late 2026.

Danaher also has a history of pruning its portfolio of businesses. The 2023 divestiture of its environmental and applied solutions group (now called Veralto) is just the latest for the company, which distributed shares in the now publicly traded Fortive Corp (industrials) to shareholders directly in 2016 and in Envista (dental) in 2019. Additional divestitures may be possible in the future as well.

Read more about Danaher here.

Amphenol

• Morningstar Price/Fair Value: 0.64
• Market Capitalization: $150.7 billion
• Morningstar Style Box: Large Growth
• Forward Dividend Yield: 0.82%
• Industry: Electronic Components

Next on our list of the best blue-chip stocks to buy is Amphenol. Amphenol is a global supplier of connectors, sensors, and interconnect systems. The stock is trading at a 36% discount to our fair value estimate of $190 per share.

We think Amphenol is a differentiated connector supplier, an excellent operator, and an exceptional steward of shareholder capital. It has numerous competitors in the fragmented electrical component industry, but its broad array of end markets allows Amphenol to expand its top line even in an individual market downturn. We think the firm’s singular ability to effect cost controls gives it the highest operating margins of its peer group, allowing it to quickly bring its numerous acquisitions up to firmwide profitability.

Amphenol provides connectors with high performance and reliability that are specialized for mission-critical applications in harsh environments. As such, we think its customer relationships are very sticky, with customers facing high financial and opportunity costs from switching to another component supplier, as well as the risk of component failure. We believe customers rely on Amphenol as a design partner to supply cutting-edge products and enable new capabilities in end applications. As older products become commoditized, the firm can maintain high prices by introducing new designs for new sockets. As a result of these switching costs and pricing power, we believe Amphenol possesses a wide economic moat.

We expect Amphenol to maintain its diversified end-market structure and expand its technological and geographic breadth through mergers and acquisitions, which have funded about one-third of the firm’s historical top-line growth. We expect artificial intelligence revenue to become the firm’s primary growth driver over the medium term but remain less than half of sales, with excellent placement in server configurations from Nvidia and others. As Amphenol grows, we expect it will maintain its best-in-class operating margins by expanding its decentralized organizational structure. The firm operates through more than 140 general managers who operate with great autonomy to respond to end customers’ needs and manage costs; we think this count will grow as the firm makes acquisitions and expands into new markets.

Read more about Amphenol here.

Sony Group

• Morningstar Price/Fair Value: 0.66
• Market Capitalization: $127 billion
• Morningstar Style Box: Large Value
• Forward Dividend Yield: 0.71%
• Industry: Consumer Electronics

Sony Group is a conglomerate with consumer electronics roots, which not only designs, develops, produces, and sells electronic equipment and devices but also is engaged in content businesses, such as console and mobile games, music, and movies. The stock is trading at a 34% discount to our fair value estimate of $32.50 per share.

As technologies and consumer preferences change rapidly, it is generally difficult for consumer electronics companies to build an economic moat. The replacement cycle for digital appliances is usually four to six years, but as most products are commoditized, it is difficult for manufacturers to build an ecosystem that prevents customers from switching to other brands. As a result, Sony’s profitability on electronics had been unstable in the past, while its music, movies, and financial-services businesses have generated solid results.

Over the past decade, Sony has transformed its business model to enable more solid and stable growth by reducing the volatility of the consumer electronics business and by aggressively investing in acquiring content for its entertainment businesses such as music, movies, and games.

In the consumer electronics business, profits are generated from digital cameras and audio equipment, where Sony has strengths, while the TV business is thoroughly focused on avoiding losses by focusing on premium products and strictly managing inventories.

In the music and movie businesses, Sony has been able to seize growth opportunities such as the expansion of the streaming market by expanding its content and exploring new artists.

The image sensor business has the largest global market share. The majority of sales come from the mobile market, which is benefiting from the strong demand for improved image quality in smartphone cameras. However, unlike the entertainment businesses, image sensors require high capital investment and research and development, and with such high fixed costs, we believe the profitability of the business is not high enough.

PlayStation is Sony’s largest revenue-generating business. While user migration from PS4 to PS5 is progressing well, rising game development costs and competition from other platforms, such as Steam, are becoming a concern for the business.

Read more about Sony Group here.

Microsoft

• Morningstar Price/Fair Value: 0.69
• Market Capitalization: $3.1 trillion
• Morningstar Style Box: Large Value
• Forward Dividend Yield: 0.88%
• Industry: Software – Infrastructure

Microsoft develops and licenses consumer and enterprise software. The stock is trading at a 31% discount to our fair value estimate of $600 per share.

Microsoft is one of three public cloud providers that can deliver a wide variety of platform-as-a-service/infrastructure-as-a-service solutions at scale. Based on its investment in OpenAI, the company has also emerged as a leader in AI. Microsoft has also enjoyed great success in upselling users on higher-priced Office 365 versions, notably to include advanced telephony features. These factors have combined to drive a more focused company that offers impressive revenue growth with high and expanding margins and deepening ties with customers.

We believe that Azure is the centerpiece of the new Microsoft. Even though we estimate it is already an approximately $75 billion business, it is still growing at approximately 30% annually. Azure has several distinct advantages, including that it offers customers a painless way to experiment and move select workloads to the cloud, creating seamless hybrid cloud environments. Since existing customers remain in the same Microsoft environment, applications and data are easily moved from on-premises to the cloud. Microsoft can also leverage its massive installed base of all Microsoft solutions as a touch point for an Azure move. Azure is also an excellent launching point for secular trends in AI, business intelligence, and Internet of Things, as it continues to launch new services centered around these broad themes.

Microsoft is also shifting its traditional on-premises products to become cloud-based software-as-a-service solutions. Critical applications include LinkedIn, Office 365, Dynamics 365, and the Power Platform, with these moves now beyond the halfway point and no longer a financial drag. Office 365 retains its virtual monopoly in office productivity software, which we do not expect to change in the foreseeable future. Lastly, the company is also pushing its gaming business increasingly toward recurring revenues and residing in the cloud. We believe that customers will continue to drive the transition from on-premises to cloud solutions, and revenue growth will remain robust with margins continuing to improve for the next several years.

Read more about Microsoft here.

Charles Schwab

• Morningstar Price/Fair Value: 0.77
• Market Capitalization: $152.7 billion
• Morningstar Style Box: Large Core
• Forward Dividend Yield: 1.46%
• Industry: Capital Markets

Charles Schwab is one of the largest retail-oriented financial-services companies in the US, with $11.9 trillion in client assets across its brokerage, banking, asset management, custody, financial advisory, and wealth-management businesses at the end of 2025. This cheap stock looks 23% undervalued and has a fair value estimate of $114 per share.

Charles Schwab’s strategy rests on three core pillars: deepening client relationships, leveraging scale to drive platformwide efficiency, and delivering on what the company calls the brilliant basics. We view this as an appropriate approach.

Schwab has done an excellent job over the years in deepening its customer relationships by building a robust, intuitive trading and advisory platform with an ever-expanding menu of services. From its roots as a retail brokerage, Schwab has expanded into mutual fund distribution, proprietary and low-cost asset management products, lending, retirement accounts, and most recently, wealth management. As a result, it has emerged as a premier asset gatherer in the industry, with 5%-6% annual organic net asset growth over the past decade (adjusted for TD Ameritrade), driving its total client assets to $11.9 trillion at the end of 2025.

With Schwab servicing just 40%-45% of customer assets, by our estimates, we see plenty of runway for future growth as it adds in-demand products such as alternative-investment products and continues to expand its still-small loan book, encouraging clients to consolidate their financial lives with Schwab. Its attention to the brilliant basics affords Schwab the ability to credibly introduce new products and organically increase its scale.

As we see it, increasing scale and reducing cost to serve is critical in a financial-services industry that continues to see fee compression as transparency and the availability of low-cost alternatives increase. Schwab drove its expense/client assets ratio down to just 0.12% during the most recent fiscal year, head and shoulders above the 0.47% and 0.37% average among its online brokerage and wirehouse competitors, respectively.

Maintaining its position as a low-cost operator will be essential. The addition of new products allows Schwab to spread investments across a broader base of assets in a way that higher-cost peers simply cannot, entrenching its competitive edge.

Overall, the combination of Schwab’s best-in-class efficiency and attractive product suite positions the firm well to continue to gain market share in a competitive financial-services industry.

Read more about Charles Schwab here.

Bank of America

• Morningstar Price/Fair Value: 0.78
• Market Capitalization: $358.7 billion
• Morningstar Style Box: Large Value
• Forward Dividend Yield: 2.22%
• Industry: Banks – Diversified

Bank of America is a formidable financial titan with a $3.5 trillion balance sheet and a cornerstone of the American economy, holding the second-largest deposit market share in the United States. The stock is trading at a 22% discount to our fair value estimate of $65 per share.

We view Bank of America’s strategy as a testament to the efficacy of a scaled, integrated model. Pursuing a core strategy of responsible growth, the company aims to grow in a way that looks good, leveraging its size and international presence to build a system that helps almost every customer, everywhere. While peers, particularly in Europe, have narrowed their service scope, Bank of America maintains formidable scale, allowing it to demonstrate a commitment to digital leadership and to reap the economic benefits of fractionalizing this expenditure across its retail, wealth, and institutional footprints. A prime example is Erica, its AI virtual assistant, which spans business lines and facilitated 171 million interactions in the first quarter of 2026, deeply embedding the bank into the operations of its 50 million active digital users.

Flexing this scale to offer a deep product shelf at competitive costs has allowed the firm to capture top-tier market share across various lines of business. Its retail operations hold the largest market share of US consumer deposits, serving 70 million clients through roughly 3,540 financial centers. The wealth management franchise provides sticky, fee-based revenue with approximately $4.6 trillion in client balances. Meanwhile, the firm’s trading operations and investment banking division consistently rank among the top four globally by revenue.

The “responsible” pillar of the firm’s growth framework is underpinned by an unwavering commitment to a disciplined risk framework. Bank of America intentionally skews its loan portfolio toward higher-quality borrowers, operating with strict underwriting standards that have yielded the lowest total loss rate among peers in 13 of the past 14 Federal Reserve stress tests. Though the banking industry is inherently cyclical, the firm maintains a highly capitalized, liquid foundation, anchored by an 11.2% common equity Tier 1 capital ratio and $960 billion in average global liquidity. This disciplined posture ensures through-the-cycle resilience and provides ample flexibility to continually fund organic growth and deliver robust shareholder returns.

Read more about Bank of America here.

S&P Global

• Morningstar Price/Fair Value: 0.79
• Market Capitalization: $124.6 billion
• Morningstar Style Box: Large Core
• Forward Dividend Yield: 0.92%
• Industry: Financial Data & Stock Exchanges

S&P Global provides data and benchmarks to capital and commodity market participants. This cheap stock looks 21% undervalued and has a fair value estimate of $530 per share.

Whether through credit ratings, financial indexes, or commodity price reporting, S&P Global has established a wide moat from its data-driven benchmarks. Given the embedded nature of these benchmarks, S&P enjoys a strong competitive position and strong operating margins. In February 2022, S&P completed its $44 billion acquisition of IHS Markit. We believe IHS Markit’s recurring revenue model diversified S&P’s revenue, limiting upside and downside scenarios for the firm.

Bond issuance volume is a key revenue driver for S&P’s ratings business, which makes up almost 40% of the firm’s adjusted operating income. Over the long term, we believe high-single-digit revenue growth, driven by nominal GDP growth and pricing, is a reasonable expectation for this business. Regulatory issues are part of the backdrop of the firm’s ratings business, but regulations can often benefit established players.

S&P’s other segments include market intelligence (21% of adjusted operating income), S&P Dow Jones indexes (17%), energy (14%), and mobility (9%). S&P announced it will spin off its mobility division in 2026. While this business is moaty, in our view, we see limited synergy with S&P’s other segments. Market intelligence revenue is recurring but faces stout competition from other providers such as Bloomberg, LSE Group (Refinitiv), and FactSet. The indexes segment revolves around the S&P 500 index and is monetized from index subscriptions to active asset managers, license fees for passive exchange-traded funds and mutual funds, and royalties from exchange-traded options and futures. Energy consists of S&P’s legacy Platts business and IHS Markit’s resources segment.

After spinning off its education business in 2013 and rebranding to S&P Global from McGraw Hill Financial, the firm has focused on expanding margins. Adjusted operating margin rose to 55% in 2021 from 34% in 2013, driven by streamlining operations and operating leverage, with strong interim revenue growth. However, given the inclusion of IHS Markit, which had some lower-margin businesses, we expect S&P Global’s adjusted operating margins to normalize to the low 50s, below historical peaks.

Read more about S&P Global here.

Bristol-Myers Squibb

• Morningstar Price/Fair Value: 0.80
• Market Capitalization: $113.7 billion
• Morningstar Style Box: Large Value
• Forward Dividend Yield: 4.53%
• Industry: Drug Manufacturers – General

Bristol-Myers Squibb discovers, develops, and markets drugs for various therapeutic areas, such as cardiovascular, cancer, and immune disorders. The stock is trading at a 20% discount to our fair value estimate of $70 per share.

Adept at partnerships and acquisitions, Bristol-Myers Squibb has built a strong portfolio of drugs and a robust pipeline. This strategy is evident in the acquisition of Celgene, which netted the firm an excellent pipeline and a strong foothold in blood cancer. More recent acquisitions—oncology firms Mirati and RayzeBio and neurology firm Karuna—also help support Bristol’s strong overall pipeline and wide moat.

The acquisition of Medarex in 2009 helped secure Bristol’s strong first-mover advantage in cancer immunotherapy, bringing rights to novel antibodies against PD-1 (Opdivo) and CTLA-4 (Yervoy) used in melanoma as well as other cancers, including lung and kidney cancers. A newer combination drug, Opdualag, is also approved in melanoma, with ongoing trials in lung cancer. Competition from Merck’s market-leading PD-1 inhibitor Keytruda and a 2028 US patent expiration for Opdivo are clear headwinds. However, recently approved subcutaneous Opdivo Qvantig will help slow sales declines, buying time for Bristol’s pipeline to advance. BioNTech-partnered pipeline program pumitamig is in phase 3 testing in certain forms of breast and lung cancers and could be an early mover among new, bispecific immunotherapy drugs.

Bristol is aggressively repositioning itself to expand through challenging patent losses for drugs representing the majority of its sales. These include cancer drugs Revlimid and Pomalyst by 2026 and cardiovascular drug Eliquis (marketed with Pfizer) in 2028. The 2019 Celgene acquisition moved Bristol deeper into blood-related disease, which tends to be an area with strong drug pricing power and should help the company at a time when governments and private payers are pushing back on drug prices. Blood cancer cell therapy Breyanzi and anemia drug Reblozyl have secured leading positions in the US market, and pipeline drugs iberdomide and mezigdomide are in phase 3 trials. The 2020 MyoKardia acquisition (cardiology drug Camzyos) and 2024 Karuna acquisition (schizophrenia drug Cobenfy) are poised to each generate multibillion-dollar annual sales. We are monitoring data updates in 2026 that could expand labels or help secure new launches.

Read more about Bristol-Myers Squibb here.

Lockheed Martin

• Morningstar Price/Fair Value: 0.80
• Market Capitalization: $118.1 billion
• Morningstar Style Box: Large Value
• Forward Dividend Yield: 2.64%
• Industry: Aerospace & Defense

Aerospace and defense company Lockheed Martin rounds out our list of best blue-chip stocks to buy. Lockheed Martin is the world’s largest defense contractor and has dominated the Western market for high-end fighter aircraft since it won the F-35 Joint Strike Fighter program in 2001. The stock is 20% undervalued relative to our fair value estimate of $640 per share.

Lockheed derived nearly 75% of its $71 billion in 2024 sales servicing contracts from the US military, with the largest annual budget on Earth, and stands to operate the largest defense procurement program ever awarded (F-35) through the 2060s. Thus, as a bet on the defense industry, Lockheed is hard to beat. Biggest isn’t always best, but Lockheed (and investors) benefit from the sheer scale of its tens of billions of dollars of contracts that provide defined decadeslong revenue and profit streams.

Lockheed should benefit from recent and foreseeable increases in US defense spending, driven by the Pentagon’s goal to modernize the military’s ability to counter aggression from multiple so-called great power rivals, namely China and Russia, while also managing threats from terrorism and hot spots like Iran and North Korea.

Defense budgets usually ebb and flow with a nation’s wealth and its perception of danger. In the US, both have been on the rise, and among many allies, notably NATO countries as well as Korea and Japan, geopolitics is leading to larger military budgets than we’ve seen for decades. For perspective, we estimate that the portions of the US defense budget relevant to contractors like Lockheed and its many subcontractors shrank between 2011-16 by 3.7% annualized, while these budgets grew between 2016-24 by 5.8% annualized. We think the contractors’ budget will continue to grow with modernization and robust demand from the Trump administration in the near term but should moderate to around 2.5%-3.0% growth over the long term.

We think Lockheed Martin’s exposure to the F-35 program, hypersonic missiles, and the militarization of space aligns it well with areas of spending prioritized in the US defense budget. In the current environment, though, the constraint on the defense sector’s opportunity is not access to defense spending or the size of budgets, but rather the ability to deploy enough skilled employees (often requiring security clearance) and specialized components and materials (which are lately in short supply) to execute on the programs on time and on budget.

Read more about Lockheed Martin here.

How to Find More of the Best Blue-Chip Stocks to Buy

Investors who’d like to extend their search for top blue-chip stocks can do the following:

• Read Morningstar’s Guide to Stock Investing to learn how our approach to investing can inform your stock-picking process.
• Use the Morningstar Investor screener to build a shortlist of blue-chip stocks to research and watch.