5 Dow Stocks Not Allowing the DJIA a Proper Rally
The markets have been on a wild ride in this year. The seasonal theme of “Sell in May and go away” passed and seemingly has turned into “Hold your nose and buy in June.” As of June 21, the Dow Jones Industrial Average (DJIA) is up 15%, and the S&P 500 is up 18.4%, and most major equity indexes are within striking distance of all-time highs again.
It’s important to understand that the stock market is really a market of stocks. Not all are created equal, and some companies deliver pathetic share-price performance even in strong markets.
Running a screen on the stock screener Finviz reveals that about two-thirds of the Dow’s 30 components are up by double-digit percentages in 2019. Five of the 30 components still are basically down so far in 2019, and these bottom five are holding the DJIA back from what could be more spectacular highs.
24/7 Wall St. has added color on each of these names, and we have included the five worst-performing Dow stocks below.
Walgreens Boots Alliance Inc. (NASDAQ: WBA) is down the worst out of the Dow, with a drop of 22.6% year to date, and that is even after a 6.6% rally since the end of May. It joined the Dow just in time for more health-care valuations and changing models in drug pricing and other health-care transparency rules that ultimately hurt the company.
Last seen trading at $52.59, Walgreens has a 52-week range of $49.31 to $86.31 and a dividend yield of about 3.3%.
3M Co. (NYSE: MMM) caught a mini-case of the GE disease, as its shares have continued to be under pressure. The conglomerate has many issues, from a write-down in Venezuela to environmental pollution concerns. Its most recent earnings were not enough either. Its shares are down 8.7% so far this year. Its dividend hike streak of 61 consecutive years is now completely forgotten.
Shares of 3M were last seen at $173.36, in a 52-week range of $159.32 to $219.75 and with a dividend yield of about 3.3%.
Dow Inc. (NYSE: DOW) comes in at third on this list, despite being publicly traded under this ticker only since March. Note that this was one of the three spinoffs from DowDupont. Shares reached as high as $60 back in April, but were quickly chopped down over the course of May. Although being down about 1.8% for all of 2019 is not necessarily devastating, the stock has taken a loss of roughly 7.5% in the past week alone.
Shares of Dow were exchanging hands at $48.78, with a 52-week range of $46.75 to $60.52. The stock has a dividend yield of 5.7%.
UnitedHealth Group Inc. (NYSE: UNH) is the largest health insurer in America, and it has a lot to lose if a Medicare-for-all plan, or something similar, replaces the current system. Not to mention, Democratic presidential candidates are already voicing their ideas of what they would change about health care in the U.S. if elected president. UnitedHealth was last seen down 0.6% so far in 2019, and having one of the lowest dividend yields of the 30 Dow stocks means it’s harder for the dividend to make up what would otherwise be a small loss.
UnitedHealth was recently trading at $250.49, in a 52-week range of $208.07 to $287.94. It has just a 1.7% dividend yield.
Pfizer Inc. (NYSE: PFE) is still barely in the red in 2019 with a drop of less than 0.5%, even with a high dividend yield. And the drug price pressure, ongoing transparency issues and patent cliffs all continue to weigh on Pfizer. This looks even worse on a relative basis, as Merck shares were up about 11% so far in 2019.
Trading at $43.60, Pfizer has a 52-week range of $36 to $46.47 and a dividend yield of about 3.3%.