Commenting on the market's volatility, Kelley Wright says, "Damn the torpedoes and full steam ahead." He explains, "These events are what create value and have provided us with opportunity over the years to acquire outstanding companies at excellent price/yield levels. I suspect this time will be no different. Hang in there; this too shall pass."

In his Investment Quality Trends, Kelley Wright select stocks based on quality and yield. In his latest update, he says, "Whenever liquidity, the lifeblood of any market, is compromised, things can get ugly right damn skippy."

However, he remains optimistic for the long-term. He notes, "Fundamental measures of value are fundamental for a reason; they don't change with the whims of the day. The markets are a self-regulating mechanism that restores order when excess exceeds a sustainable level."

Meanwhile, he notes that he continues to recommend several blue chip equity. He says, "We have been long Barrick Gold (NYSE: ABX) in our model portfolio since 2003, when the stock traded in the high teens. We buy more every time it falls into our undervalued category, such as now. With the U.S. dollar under pressure, it makes even more sense."

The advisor also likes Automatic Data Processing (NYSE: ADP). He notes, "ADP is undervalued by our proprietary measures, has an S&P earnings and dividend quality ranking of A-plus, has had at least 10% annual dividend growth for the past 12 years and has a 55% or better return on equity."

In addition, he sees value in Colgate-Palmolive (NYSE: CL). He explains, :The stock also has a quality ranking of A-plus. It has also shown 10% annual dividend growth over the past 12 years. If things turn ugly, this stock should hold up nicely."

Each day, Steven Halpern's TheStockAdvisors.com features the latest investment ideas and market commentary from the financial newsletter community.

Blue chips with quality and yield originally appeared on BloggingStocks on Tue, 07 Aug 2007 15:25:00 EST. Please see our terms for use of feeds.