First Published on June 27th, 2023 by Bob Ciura for SureDividend. Spreadsheet data updated daily
Mega-cap stocks are companies with market capitalizations in excess of $200 billion. The total number of mega cap stocks varies depending upon market conditions. Right now there are over 50 mega-cap stocks, so there are plenty to choose from for investors.
These are the largest stocks in the market today and tend to have recognizable brands, in addition to fairly steady revenue, earnings, and in many cases dividends. Thus, mega cap stocks would tend to appeal to a wide variety of investors as they would typically see less volatility than smaller stocks and have more predictable forward returns.
You can download a free spreadsheet of all 50+ mega cap stocks (along with important financial metrics such as price-to-earnings ratios and dividend yields) by clicking on the link below:
This article includes a spreadsheet and table of all mega cap stocks, as well as detailed analysis on our Top 10 mega cap stocks today.
Keep reading to see the 10 best mega cap stocks analyzed in detail.
In this article
The 10 Best Mega Cap Stocks Today
Now that we’ve defined what a mega cap stock is, let’s take a look at the 10 best mega cap stocks, as defined by our Sure Analysis Research Database.
The database ranks total expected annual returns, combining current yield, forecast earnings growth and any change in price from the valuation.
Note: The Sure Analysis Research Database is focused on income producing securities. As a result, we do not track or rank securities that don’t pay dividends. Mega caps that don’t pay dividends were excluded from the Top 10 rankings below. In addition, only U.S. based mega cap stocks were considered for the top 10 list.
We’ve screened the mega cap stocks with the best prospective returns and have provided them below, ranked in reverse order of forecast total returns. You can instantly jump to any individual stock analysis by using the links below:
- Mega Cap Stock #10: Coca-Cola Co. (KO)
- Mega Cap Stock #9: Visa Inc. (V)
- Mega Cap Stock #8: Pfizer Inc. (PFE)
- Mega Cap Stock #7: JP Morgan Chase (JPM)
- Mega Cap Stock #6: Cisco Systems (CSCO)
- Mega Cap Stock #5: Johnson & Johnson (JNJ)
- Mega Cap Stock #4: Thermo Fisher (TMO)
- Mega Cap Stock #3: Mastercard Inc. (MA)
- Mega Cap Stock #2: UnitedHealth Group (UNH)
- Mega Cap Stock #1: Bank of America (BAC)
Mega Cap Stock #10: Coca-Cola Co. (KO)
- 5-year expected annual returns: 8.2%
Coca-Cola is the world’s largest beverage company, as it owns or licenses more than 500 unique non–alcoholic brands. Since the company’s founding in 1886, it has spread to more than 200 countries worldwide.
Source: Investor Presentation
The company also has an exceptional 59-year dividend increase streak.
Coca-Cola’s competitive advantages include its unparalleled suite of beverage brands, as well as its efficient global
distribution network. Coca-Cola is also extremely resistant to recessionary environments, having increased its earningsper-share during and after the financial crisis.
Click here to download our most recent Sure Analysis report on KO (preview of page 1 of 3 shown below):
Mega Cap Stock #9: Visa Inc. (V)
- 5-year expected annual returns: 8.6%
Visa is the world’s leader in digital payments, with activity in more than 200 countries. The company’s global processing network provides secure and reliable payments around the world and is capable of handling more than 65,000 transactions a second. In fiscal year 2022 the company generated $16 billion in profit.
On April 25th, 2023, Visa reported second quarter 2023 results for the period ending March 31st, 2023. (Visa’s fiscal year ends September 30th.) For the quarter, Visa generated revenue of $8.0 billion, adjusted net income of $4.4 billion and adjusted earnings-per-share of $2.09, marking increases of 11%, 14% and 17%, respectively.
Click here to download our most recent Sure Analysis report on Visa (preview of page 1 of 3 shown below):
Mega Cap Stock #8: Pfizer Inc. (PFE)
- 5-year expected annual returns: 8.6%
Pfizer Inc. is a global pharmaceutical company that focuses on prescription drugs and vaccines.
Pfizer’s new CEO completed a series of transactions significantly altering the company structure and strategy. Pfizer formed the GSK Consumer Healthcare Joint Venture in 2019 with GlaxoSmithKline plc (GSK), which includes Pfizer’s over-the-counter business. Pfizer owns 32% of the JV. Pfizer spun off its Upjohn segment and merged it with Mylan forming Viatris for its off patent, branded and generic medicines in 2020.
Pfizer’s top products are Eliquis, Ibrance, Prevnar, Enebrel (international), Sutent, Xtandi, Vyndaqel/ Vyndamax, Inlyta, Xeljanz, Plaxlovid, and Comiranty.
Pfizer reported Q1 2023 results on May 2nd, 2023. Company-wide revenue fell (-29%) to $18,282M from $25,661M and adjusted diluted earnings per share dropped (-24%) to $1.23 versus $1.62 on a year-over-year basis because of declining COVID-19 vaccine and anti-viral drug sales. Diluted GAAP earnings per share fell (-29%) to $0.97 from $1.37 in comparable quarters.
Click here to download our most recent Sure Analysis report on Pfizer (preview of page 1 of 3 shown below):
Mega Cap Stock #7: JP Morgan Chase (JPM)
- 5-year expected annual returns: 9.0%
JPMorgan was founded in 1799 as one of the first commercial banks in the U.S. Since then, it has merged or acquired more than 1,200 different institutions, creating a global banking behemoth with about $124 billion in annual revenue. JPMorgan competes in every major segment of financial services, including consumer banking, commercial banking, home lending, credit cards, asset management and investment banking.
JPMorgan reported first quarter earnings on April 14th, 2023, and results were much better than expected on both revenue and earnings. The bank posted earnings-per-share of $4.10, which was 69 cents better than estimates. Revenue soared 25% year-over-year to $38.3 billion, beating estimates by more than $2.5 billion.
Click here to download our most recent Sure Analysis report on JPM (preview of page 1 of 3 shown below):
Mega Cap Stock #6: Cisco Systems (CSCO)
- 5-year expected annual returns: 9.8%
Cisco Systems is the global leader in high-performance computer networking systems. The company’s routers and switches allow networks worldwide to connect to each other through the internet. Cisco also offers data center, cloud, and security products. Cisco generates about $51 billion in annual revenues.
On May 17th, 2023, Cisco reported earnings results for the third quarter of fiscal year 2023. For the quarter, revenue grew 13.5% to $14.6 billion, which was $210 million above estimates. Adjusted earnings-per-share of $1.00 compared to adjusted earnings-per-share of $0.87 in the prior year and was $0.03 more than expected.
Click here to download our most recent Sure Analysis report on Cisco Systems (CSCO) (preview of page 1 of 3 shown below):
Mega Cap Stock #5: Johnson & Johnson (JNJ)
- 5-year expected annual returns: 10.6%
Johnson & Johnson is a global healthcare giant. The company currently operates three segments: Consumer, Pharmaceutical, and Medical Devices & Diagnostics. The corporation includes roughly 250 subsidiary companies with operations in 60 countries and products sold in over 175 countries.
Johnson & Johnson’s key competitive advantage is the size and scale of its business. The company is a worldwide leader in several healthcare categories. Johnson & Johnson’s diversification allows it to continue to grow even if one of the segments is underperforming.
The company has increased its dividend for 60 consecutive years, making it a Dividend King. The stock is owned by many well-known money managers. For example, J&J is a Kevin O’Leary dividend stock.
Click here to download our most recent Sure Analysis report on JNJ (preview of page 1 of 3 shown below):
Mega Cap Stock #4: Thermo Fisher (TMO)
- 5-year expected annual returns: 11.2%
Thermo Fisher Scientific Inc. is the world leader in serving complex analytical challenges, helping its customers accelerate life sciences research, improving patient diagnostics, and increasing productivity in global laboratories.
The company’s operational segments, along with their respective % of revenues, are: Diagnostics & Healthcare (28%), Pharma & Biotech (45%), Industrial applications (13%), and Academic & Government (14%). Thermo Fisher generates around $41 billion in annual sales.
Source: Investor Presentation
Click here to download our most recent Sure Analysis report on TMO (preview of page 1 of 3 shown below):
Mega Cap Stock #3: Mastercard Inc. (MA)
- 5-year expected annual returns: 12.7%
Mastercard is a world leader in electronic payments. The company partners with 25,000 financial institutions around the world to provide an electronic payment network. Mastercard has nearly 3 billion credit and debit cards in use.
On April 27th, 2023, MasterCard announced first quarter results for the period ending March 31st, 2023. For the quarter, revenue grew 9.6% to $5.7 billion, which was $60 million above estimates. Adjusted earnings-per-share of $2.80 compared favorably to $2.76 in the prior year and was $0.09 better than expected.
Click here to download our most recent Sure Analysis report on Mastercard (preview of page 1 of 3 shown below):
Mega Cap Stock #2: UnitedHealth Group (UNH)
- 5-year expected annual returns: 14.2%
UnitedHealth dates back to 1974 when Charter Med was founded by a group of health care professionals looking for ways to expand healthcare options for consumers. UnitedHealth has certainly done that in the decades since and now offers global healthcare services to tens of millions of people via a wide array of products.
The company has two major reporting segments: UnitedHealth and Optum. The former provides global healthcare benefits to individuals, employers, and Medicare/Medicaid beneficiaries. The Optum segment is a services business that seeks to lower healthcare costs and optimize outcomes for its customers. UnitedHealth produces about $321 billion in revenue annually, making it one of the largest companies in America by either measure.
Click here to download our most recent Sure Analysis report on UnitedHealth (preview of page 1 of 3 shown below):
Mega Cap Stock #1: Bank of America (BAC)
- 5-year expected annual returns: 15.2%
Bank of America, headquartered in Charlotte, NC, provides traditional banking services, as well as non–banking financial services to customers all over the world. Its operations include Consumer Banking, Wealth & Investment Management and Global Banking & Markets.
Bank of America was founded in 1904, and should produce about $89 billion in revenue this year. Bank of America is one of the largest financial stocks in the world.
Click here to download our most recent Sure Analysis report on Bank of America (preview of page 1 of 3 shown below):
Final Thoughts
Mega cap stocks offer investors access to the largest and generally most profitable companies in the world. The group tends to hold up better during downturns and offer investors steady streams of revenue and earnings.
Many of the stocks on this list offer investors generous dividend yields as well, but all of them have high prospective total returns. These 10 stocks, we believe, collectively offer investors an attractive blend of growth, value and yield.
Related:
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