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Best — and WORST — Dow Stocks of Q1

Financials take the taco, while tech/telecom bottom out

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Worst Stock: Hewlett-Packard (-7.5%)

Only three stocks out of 30 Dow components posted a loss in Q1, and Hewlett-Packard (NYSE:HPQ) was far and away the biggest loser with a significant -7.5% slide.

The reasons are nothing new: Antics in the executive suite persist after the recent ouster of Leo Apotheker after less than one year in the corner office, and his replacement by former eBay (NASDAQ:EBAY) exec Meg Whitman. There’s the recent mash-up of PC and printer divisions, a thinly veiled exercise in continued streamlining of cumbersome operations. There’s also a rather pathetic 10% dividend increase that is small consolation to investors after tens of billions wasted on buyouts over the last several years.

About a year ago, I wrote a piece with the headline, “Hewlett-Packard Embodies What’s Worst In Corporate America.” It just so happens that HP’s lack of vision and leadership also represents the worst of the tech sector — and some investors’ portfolios — too.

Second Worst: Verizon (-4.7%)

There’s no obvious reason why Verizon (NYSE:VZ) has taken a slide in Q1 while the broader market has rallied. But I suspect it has a lot to do with sector rotation out of low-risk income investments like utilities and telecoms and into areas where investors see growth or profit potential.

As I wrote in December, the reality is that these investments ran up too much as investors plowed cash into shares simply to insulate their portfolios from volatility. Any time a utility stock that is a legalized monopoly soars 30% in six months … well, you have to know the fundamentals just aren’t there.

Verizon is an entrenched telecom that’s going nowhere; however, the stock did soar 12.5% from August to December 2011 — six times the 2% added by the Dow Jones Industrial average. It was destined to cool off, and cool off Verizon has in early 2011.

Complete Dow Jones Returns

Here’s the complete list of components and Q1 returns, in alphabetical order:

Dow Jones Industrial Average: +8.1%
(NYSE:MMM): +9.2%
(NYSE:AA): +15.8%
American Express
(NYSE:AXP): +22.7%
(NYSE:T): +3.3%
Bank of America
(NYSE:BAC): +72.1%
(NYSE:BA): +1.4%
(NYSE:CAT): +17.6%
(NYSE:CVX): +0.8%
(NYSE:KO): +5.8%
(NYSE:DD): +15.6%
(NYSE:XOM): +2.3%
General Electric
(NYSE:GE): +12.1%
(NYSE:HPQ): -7.5%
Home Depot
(NYSE:HD): +19.7%
International Business Machines
(NYSE:IBM): +13.5%
Johnson & Johnson
(NYSE:JNJ): +0.6%
JPMorgan Chase
(NYSE:JPM): +38.3%
Kraft Foods
(NYSE:KFT): +1.7%
(NYSE:MCD): -2.2%
(NYSE:MRK): +1.9%
(NASDAQ:MSFT): +24.3%
(NYSE:PFE): +4.6%
Procter & Gamble
(NYSE:PG): +0.8
Travelers Companies
(NYSE:TRV): +0.1%
United Technologies
(NYSE:UTX): +13.5%
(NYSE:VZ): -4.7%
(NYSE:WMT): +2.4%
Walt Disney
(NYSE:DIS): +16.8%

Jeff Reeves is the editor of, and the author of “The Frugal Investor’s Guide to Finding Great Stocks.” Write him at editor@investorplace?.com or follow him on Twitter via @JeffReevesIP. As of this writing, Jeff did not hold a position in any of the aforementioned securities.

Article printed from InvestorPlace Media,

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