Blue-chip stocks are shares of large, well-established, financially stable companies with a consistent and reliable performance history. They are often considered less risky and are a popular choice for long-term investors. Nearly all leaders in the category pay dependable, recurring dividends each quarter, regardless of the state of the economy. Our $100,000 blue-chip value portfolio is designed for Boomers and retirees seeking dependable passive income from high-quality companies that pay big dividends. The term “blue chip” originated in poker, where it refers to the highest-value chip.
Passive income is characterized by its ability to generate revenue without requiring the earner’s continuous active effort, making it a desirable financial strategy for those seeking to diversify their income streams or achieve financial independence. The more passive income can help cover rising costs, such as mortgages, insurance, taxes, and other expenses, the easier it is for investors to set aside money for future needs as they prepare for retirement. Dependable recurring dividends from quality, high-yield stocks are a recipe for success, and blue-chip dividend-paying companies are the perfect vehicles to achieve it.
We put together a growth-and-income portfolio with five of the highest-yielding value blue-chip giants. Investing $20,000 in each will generate $6,500 in safe, predictable passive income. Investors could increase that amount by selling covered call options on their holdings. Plus, since these companies often raise their dividends, the income is likely to increase slightly each year. The purchase amounts and dividend income totals are based on the time this post was written.
Why do we cover blue-chip value dividend stocks?
Since 1926, dividends have accounted for approximately 32% of the S&P 500’s total return, while capital appreciation has accounted for 68%. Therefore, sustainable dividend income and the potential for capital appreciation are essential to total return expectations. A study by Hartford Funds, in collaboration with Ned Davis Research, found that dividend stocks delivered an annualized return of 9.18% over the 50 years from 1973 to 2023. Over the same timeline, this was more than double the annualized return for non-payers (3.95%).
Altria
Altria Group (NYSE: MO | MO Price Prediction) is one of the world’s largest producers and marketers of cigarettes and other tobacco-related products. It offers long-term value and a 6.01% dividend. Altria manufactures and sells smokable and oral tobacco products in the United States. The company primarily sells cigarettes under the Marlboro brand, as well as:
- Cigars and pipe tobacco, principally under the Black & Mild and Middleton brands
- Moist smokeless tobacco and snus products under the Copenhagen, Skoal, Red Seal, and Husky brands
- on! Oral nicotine pouches
- e-vapor products under the NJOY ACE brand
It sells its tobacco products primarily to wholesalers, including distributors and large retail organizations, such as chain stores.
Altria used to own over 10% of Anheuser-Busch InBev (NYSE: BUD), the world’s largest brewer. In 2024, the company sold 35 million of its 197 million shares through a global secondary offering. That represents 18% of its holdings but still leaves 8% of the outstanding shares in its back pocket. Altria also announced a $2.4 billion stock repurchase plan partially funded by the sale.
Altria increased its quarterly dividend in the fall of 2025 by 3.9%, from $1.02 to $1.06 per share, marking its 55th consecutive annual dividend increase.
$20,000 will buy 280 shares, which pay $4.24 per year for a total of $1,187.
Stifel has a Buy rating with a $77 target price.
Energy Transfer
Energy Transfer (NYSE: ET) is one of North America’s largest and most diversified midstream energy companies. This top master limited partnership is a safe option for investors seeking energy exposure and income, as the company pays a 6.81% distribution yield. Energy Transfer owns and operates one of the largest and most diversified portfolios of energy assets in the United States, with a strategic footprint across all major domestic production basins.
The company is a publicly traded limited partnership with core operations that include:
- Complementary natural gas midstream, intrastate, and interstate transportation and storage assets
- Crude oil, natural gas liquids (NGL), and refined product transportation and terminalling assets
- NGL fractionation
- Various acquisition and marketing assets
Following the acquisition of Enable Partners in December 2021, Energy Transfer owns and operates over 114,000 miles of pipelines and related assets in 41 states, spanning all major U.S. producing regions and markets. This reinforces its leadership position in the midstream sector.
Through its ownership of Energy Transfer Operating, formerly known as Energy Transfer Partners, the company also owns Lake Charles LNG; the general partner interests, the incentive distribution rights, and 28.5 million standard units of Sunoco; and the public partner interests and 39.7 million standard units of USA Compression Partners.
$20,000 will purchase 995 shares, which pay $1.35 per year, for a total of $1,343.
Wells Fargo has an Overweight rating on the shares, with a $25 target price.
General Mills
With products that never go out of style and a strong 7.12% dividend yield, this is a rebound story that will reward patient investors. General Mills (NYSE: GIS) is a global manufacturer and marketer of branded consumer foods, and trades at a cheap 10.4 times estimated 2026 earnings. Its segments include:
- North America Retail
- International
- North America Pet
- North America Foodservice
The North America Retail segment reflects business with a variety of grocery stores, mass merchandisers, membership stores, natural food chains, drug, dollar, and discount chains, convenience stores, and e-commerce grocery providers.
The International segment consists of retail and foodservice businesses outside the United States and Canada. Its product categories include super-premium ice cream and frozen desserts, meal kits, salty snacks, snack bars, dessert and baking mixes, and shelf-stable vegetables.
The North America Pet segment includes pet food products sold in the United States and Canada in national pet superstore chains, e-commerce retailers, and grocery stores.
The North America Foodservice segment product categories include ready-to-eat cereals, snacks, and baking mixes.
$20,000 will buy 595 shares, which will pay $2.44 per year, for a total of $1,451.
Piper Sandler has an Overweight rating and a $41 target price.
UPS
United Parcel Service (NYSE: UPS) announced last year that it would cut its shipping volume for e-commerce giant Amazon by more than 50% by the second half of 2026, and it was one of the best ideas among the top dividend picks, with a dividend yield now at 6.66%. The package delivery company faced headwinds from discontinuing its Amazon business and expectations of slower economic growth. It said the move is part of UPS’s broader strategy to focus on more profitable, less risky business segments. UPS provides a range of integrated logistics solutions for customers in more than 200 countries and territories.
While UPS has never trimmed its dividend since listing in 1999, that track record offers reassurance rather than a guarantee. The growth may pause, but a cut remains off the table for now.
Its segments include:
- U.S. Domestic Package
- International Package
The U.S. Domestic Package segment offers a range of domestic air and ground package transportation services within the United States. Its air portfolio offers time-definite, same-day, next-day, two-day, and three-day delivery alternatives as well as air cargo services. UPS’s ground network enables customers to ship using its day-definite ground service. UPS SurePost provides residential ground service for customers with non-urgent, lightweight residential shipments.
The International Package segment comprises its small package operations in Europe, the Indian subcontinent, the Middle East and Africa, Canada, Latin America, and Asia. It offers a selection of guaranteed day- and time-definite international shipping services. Its supply chain solutions consist of forwarding, logistics, and other businesses.
$20,000 will buy 202 shares, which pay $6.56 per year, for a total of $1,325.
Jefferies has a Buy rating with a $130 price objective.
Verizon
Verizon Communications (NYSE: VZ) is an American multinational telecommunications company that continues to offer tremendous value. It trades at 9.37 times its estimated 2026 earnings, and pays a 6% dividend. Verizon provides a range of communications, technology, information, and entertainment products and services to consumers, businesses, and government entities worldwide.
Verizon’s trailing 12-month interest coverage ratio is 4.6× to 5×, providing ample cushion for dividend payments. With a very predictable revenue stream from telecom services, the company has less exposure to commodity cycles. In addition, the large scale helps in financing and absorbing shocks.
It operates in two segments. The Consumer Group segment provides wireless services across the United States through Verizon and TracFone networks, as well as through wholesale and other arrangements. It also provides fixed wireless access (FWA) broadband through its wireless networks and related equipment and devices, such as:
- Smartphones
- Tablets
- Smartwatches and other wireless-enabled connected devices
The segment also offers wireline services in the Mid-Atlantic and northeastern United States through its fiber-optic network, Verizon Fios product portfolio, and copper-based network.
The Business Group segment provides wireless and wireline communications services and products, including:
- FWA broadband
- Data
- Video and conferencing
- Corporate networking
- Security and managed network
- Local and long-distance voice
Network access services to deliver various IoT services and products to businesses, government customers, and wireless and wireline carriers in the United States and internationally.
$20,000 will purchase 422 shares, which pay $2.83 per year, for a total of $1,195.
Raymond James has an Outperform rating and a $56 price target.
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