10 Dow Jones Stocks We Expect will Finish Strong this Year
Its been an interesting year for small-caps and the tech-heavy Nasdaq Composite. Since 2017, the Nasdaq is up 14%, and the S&P 600 Small Cap Index is up 15%. In comparison, The S&P 500 hasn’t gone above 10% from where it closed at the end of last year. The Dow Jones stocks are collectively the lowest gainers with only 8%.
What we do get to see is the change in direction the market leaders are taking, as well as their bot’s and algorithms. Currently, the Nasdaq and small caps are struggling, while the Dow Jones Industrial Average is becoming popular with investors seeking blue chips for safe havens. We can see this in the last three months figures, where the Dow rose more than 10% while the Nasdaq just pipped 6%.
What this is showing us is a clear end of the year strong finish for the Dow.
Now that we have considered the above scenario let’s take a quick look at the top 10 picks for a strong 2018 finish.
Boeing (NYSE: BA) is part of an ever increasing industry that is expected to deliver more than 40,000 new planes by the end of 20136. Yes, that’s a while away, and it won’t happen in one year, but the baseline is that today there are only 23,500 jets on the market.
Current market trends show that air travel will continue to increase annually by 4.7%, and Boeing is still one of the major commercial jet plan producers. If Boeing can break through the $372 ceiling, it will take off, so watch out for this instance.
Goldman Sachs Group (GS)
Goldman Sachs (NYSE: GS) has been in retreat for quite a while now; this is partially due to the retirement of the CEO Lloyd Blankfein. Mind you; his replacement CEO-elect David Solomon is a very capable professional.
In my view, the market is unjustifiably reluctant, and when Berkshire Hathaway invests $5 billion in preferred Goldman Sachs stock last quarter, it makes me sit up and consider the implications. It looks like this is one attractively priced stock, ready for picking and a boosting.
International Business Machines (IBM)
International Business Machines (NYSE: IBM) it’s been 22 consecutive quarters of bad sales figures that led this companies shares to where they are today. Recently, they have managed to change things around, and now it’s a matter of changing habits, perceptions, and trust.
IBM is showing a change in the general trend of things, and it has started to rise from its 52-weeks low. Perhaps the new AI tool unveiling will change the direction completely and bring back an old lost love into the bullpen.
Travelers Companies (TRV)
Travelers Companies (NYSE: TRV) this insurance company is expected to outperform any hurricane, and while the insurance industry has taken a hit from recent weather changes, the premiums are all going up.
Rising premiums will lead to an exponential gain since payouts from expected weather conditions do not look like they will come near to denting the current insurance industries capacity to pay out.
The bottom line is this, TRV along with others in this sector have had a good run in rebuilding capital assets, this will be shown in the reports, and this is one show you want to be part of.
Walgreens Boots Alliance (WBA)
Walgreens Boots Alliance (NASDAQ: WBA) while they recently acquired additional 2,000 units of Rite Aid (NYSE: RAD), did not bring about a great cheer from investors. Their stock value is still 17% down from their 2017 high spot.
The investors are actually a bit fickle here, and the numbers show another direction for this strong growing company. Sales are expected to increase by 12% this year, and with the additional Rite-Aid units, grow over a further 5% next year. Add to these figures the increase in earnings that rose from last years $5.10 per share to a profit of $5.98 and the forecasted $6.46 for next year, and you have a certified winner on your hands.
Caterpillar (NYSE: CAT) this amazing company in a sector that has been unreasonably hit by investors due to the tariff issues, is showing signs of continuing growth. One the fallacies that investors believe in are the so-called detrimental effect of tariffs on sales.
CAT is a leading brand that is a mandatory buy for all and any serious construction and infrastructure company around the world. Its sales figures prove this, and its shunned shares is a mockery to reality. The bottom line is that CAT is a strong company, and its growing stronger.
Walt Disney (DIS)
Admittedly, Walt Disney (NYSE: DIS) this underperforming entertainment giant has been in sorry affairs since 2015. With its struggling ESPN limb, and the decision to outsource to Netflix (NASDAQ: NFLX) instead of creating its own channel, DIS struggles to stay afloat.
However, just like Dumbo, sometimes you need a crow to kick you off a branch to make you soar. Twenty-First Century Fox (NASDAQ: FOXA, NASDAQ: FOX) is that crow, and DIS is expected to launch, especially since it has broken above the upper edge of a converging wedge pattern.
3M (NYSE: MMM) yup, it’s a solid company with no ventures and entertainment value. It is a fabricator of everyday life products and as one person stated, Monotonous, Mundane, Modest. The new 3M. However, what would you prefer for security, a bipolar venture or a steady annual improved income and sales on a constant increase year after year by increments of 3% to 5%? As such, this is a modest monotone company that makes money from being mundane, and as such is a great investment.
Verizon Communications (VZ)
Verizon Communications (NYSE: VZ) might be considered by some as a little high to be attractive. After all, it’s up 14% from its May low. It was also 18% higher during this last month. While the shares to bounce around a bit, the general direction is up, and a lot.
We are looking at a company that just gave out a 4.5% dividend yield. Take into consideration that VZ has dished out dividends quarter after quarter, and compare the difference today to what it gave out ten years ago (more than double). Now add dot that the fact that its liquidity allows it to be so generous. Do the math yourself.
McDonald’s (NYSE: MCD) this food giant has improved by 70% since February. The trend this company took was the right one, moving away from ownership to the franchise. Reducing operational overheads and replacing them with net income.
The big Mac is expected to continue gaining ground next year and grow by a further 7%, which for a company this size, is enormous.