Buy-and-hold investors shouldn't be too concerned with the market's recent gyrations. Yes, the broader stock market is off about 10% from a July peak, but the long-term trend has remained clearly upward since the financial-crisis lows of 2008 and 2009.

If you have some cash, this could be a good time to hunt for bargains. Make no mistake -- some companies were sold off for a reason. But by limiting yourself to big-name, blue-chip companies with stable businesses and decent dividend yields, you can be relatively confident that your portfolio will withstand short-term volatility and come through with a handy profit a few years down the road.

Here are five low-risk investments that today can be considered bargains for long-term investors:


One of the biggest blue chips, AT&T (T, news) is a company with almost $125 billion in annual revenue and an entrenched position in the telecommunications industry.

So what's to like about AT&T? For starters, the dividend. The stock has a yield of about 6%, the best right now among Dow components. The income potential of AT&T puts it in an attractive category that compares favorably to the lackluster yields of 10-year Treasury notes and other traditional alternatives.

What's more, shares are 7% off their July peak and in the middle of AT&T's 52-week trading range of $27.06 to $31.94. It's reasonable to expect AT&T will break through previous highs, especially if the Dallas company's merger plans with T-Mobile can overcome objections from antitrust regulators and gain approval, allowing AT&T to strengthen its grip on the smartphone market.

AT&T shares dipped as low as $22 in March 2009, although aside from a week or two in July 2009, the stock never again closed below $24. Even if you're afraid the market will retest the financial-crisis lows, AT&T can reasonably be expected to stand tall in the storm.

Cisco Systems

In the depths of the 2008-09 sell-off, shares of Cisco Systems (CSCO, news) flopped from around $25 to briefly bottom out below $14. The stock today trades at a little under $16.

Yes, investors have had good reason to shun Cisco; rival Juniper Networks (JNPR, news) has elbowed into the corporate marketplace, and bloated operations have stifled Cisco's ability to adapt to the cloud-computing revolution.

But there are reasons to be optimistic. In the past year, Cisco has seen a big management shake-up, thousands of layoffs and production changes that include a shift away from consumer offerings of its digital video recorders and Flip video cameras. The turnaround might come at the perfect time for investors who buy during the current mayhem.

Wall Street insiders seem to think things are turning around at Cisco. According to 36 experts surveyed by Thomson/First Call, price targets for the stock range from roughly 15% to 25% above the current valuation. Not setting the world on fire, but in this difficult market those are potential gains most investors would gladly take.

Maybe that's why analysts at Stifel Nicolaus and Wunderlich Securities upgraded Cisco to "buy" after the company released its fiscal-fourth-quarter financial results on Aug. 10.

What's more, Cisco in March began offering a decent dividend, currently yielding 1.5%. In this environment, investors should be wary of any stock that doesn't offer a dividend. Best to stick with cash-rich blue chips like Cisco.


Wal-Mart Stores (WMT, news) has not been inspiring in the past year. Discounters like Dollar Tree (DLTR, news) have been eating Wal-Mart's lunch, and the big-box giant hasn't posted same-store sales growth in the United States for the past two years.

But this mega-cap retailer isn't exactly going out of business. Revenues and yearly earnings have grown steadily in each of the past four years, despite the economic downturn and troubles with same-store traffic.

Also, the company has been trying to reconnect with consumers via big strategic initiatives. A plan to squeeze Wal-Mart outlets into urban locations with smaller stores could tap into big revenue streams domestically. And, if not, a big emerging-markets push could help offset the company's U.S. shortfalls.

The global Wal-Mart plan -- including a $2.4 billion buyout of South African retailer Massmart and a possible $760 million investment in Brazil -- could help reverse the company's fortunes.

It seems Wall Street is conflicted about Wal-Mart shares. The mean target for Wal-Mart among 21 analysts surveyed by Thomson/First Call is just north of $60, representing a potential 15% jump from current valuations.

There are legitimate concerns about Wal-Mart's growth potential and same-store sales. However, low-risk investors looking for bargains should be content with the fact that Wal-Mart is a bulletproof investment that seems undervalued. A double-digit upside can't be pooh-poohed.

Throw in the 2.7% dividend yield and you've got a decent buy in Wal-Mart.