#5 Dow Stock: AT&T
YTD Gain: 17%
The No. 5 spot in the Dow goes to telecom blue chip AT&T (NYSE:T), up 17% as of this writing.
The sleepy stock is well-known among dividend investors for its payout potential — a nice 5% yield right now — but hasn’t exactly been an icon of growth. After all, there are only so many cell phones and so many businesses to hook up to the Internet. In many ways, AT&T is a utility stock more than a communications company. It is in a highly regulated industry, it enjoys a virtual duopoly with Verizon (NYSE:VZ) even without its failed T-Mobile buyout, and it has a scale and reach that no upstart competitor can realistically challenge considering the capital-intensive nature of telecommunications networks in the 21st century.
So why has AT&T soared in 2012? Well, because of the “flight to safety,” similar to what we saw in late 2011 that boosted utility stocks and other safe-haven investments. As the eurozone melts down and unemployment remains troublesome at home, investors are looking for stability above all else. That has prompted big demand for AT&T stock, pushing it to a new 52-week high.