5 Stocks That Should Join the Dow

Kraft, Alcoa and HPQ all could be in line for the heave-ho

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KraftFoodsLogo e1282588018415 5 Stocks That Should Join the DowIn case you haven’t heard, Dow Jones Industrial Average component Kraft Foods (NYSE:KFT) is going to split up its business. Via a spinoff that was first announced in 2011, the consumer giant will become two companies — a North American grocery store provider that will retain the Kraft name and peddle items like Miracle Whip and blue-box Macaroni & Cheese, and a global snack foods giant with the cumbersome name Mondelez.

The move creates some trouble in the Dow 30 list, because the spinoff essentially will cut the footprint of the stock in half. That will make beverage-and-snack giant PepsiCo (NYSE:PEP) larger by market cap — and Kraft won’t be much bigger than cereal giant General Mills (NYSE:GIS).

And if you want to be really critical of the Dow, other stocks might have to get the heave-ho, too. Aluminum giant Alcoa (NYSE:AA) is a mid-cap stock these days with a valuation of under $9 billion. Hewlett-Packard (NYSE:HPQ) has lost about half of its value in the past year and could very soon be on the outs if it can’t turn things around.

It all adds up to a looming shakeup for the Dow, according to many experts. So the question is: If Kraft or any other component gets booted from the benchmark index … what stock should be the new member?

A number of writers here at InvestorPlace have our own suggestions, and here they are:


Article printed from InvestorPlace Media, http://investorplace.com/2012/07/5-stocks-that-should-join-the-dow-aapl-amzn-cmcsa-goog-pep/.

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