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The 7 Smartest Dow Stocks to Buy if You Have $250 Right Now

  • Though suffering through a bear market cycle is no fun, it also opens the door to heavily discounted Dow stocks to buy for long-term gains.
  • Intel (INTC): Though it’s down heavily, Intel makes for one of the best Dow stocks to buy on account of its data center solutions and articial-intelligence-based innovations.
  • Walgreens Boots Alliance (WBA): Among the recession-resistant businesses, Walgreens Boots Alliance is a solid idea for long-term stability.
  • Coca-Cola (KO): Historically a favorite when downturns occur, Coca-Cola benefits from the cheap respite thesis.
  • Merck (MRK): Though it’s not on a steep discount like the other Dow stocks to buy, Merck’s powerful pharmacuetical business is only gaining in relevance due to recent events.
  • Walmart (WMT): While suffering a massive blow due to a poor earnings disclosure, Walmart in the long run is still very attractive because of its everyday low pricing model.
  • JPMorgan Chase (JPM): Though big banks have not been exempt from market pressures, JPMorgan Chase could be interesting as its wealth management business comes into focus.
  • Chevron (CVX): Though levering the highest price tag for this list of Dow stocks to buy, the relevance of hydrocarbons is too intense to ignore.
Dow stocks - The 7 Smartest Dow Stocks to Buy if You Have $250 Right Now

Source: Shutterstock

While it doesn’t rank as the most exciting avenue in the market, investing in the companies listed on the venerable Dow Jones Industrial Average could be one of the smartest moves, particularly because they’re some of the world’s most proven businesses. Still, you don’t want to just acquire anything. If you’re limited to just $250, you need to narrow down your list of Dow stocks to buy.

Given that the market has taken a turn for the volatile, it’s best to go with companies that can weather a recessionary storm. Here, analysts aren’t just being worrywarts. With the consumer price index indicating that inflation has run higher than anticipated, the Federal Reserve is raising benchmark interest rates until circumstances get under control. Therefore, Dow stocks to buy must take this dynamic into account.

To be clear, economic headwinds present speculative opportunities as many shares are now discounted from their highs. On the other hand, there are some names that might benefit from a downturn. We’ll tackle both topics for the below Dow stocks to buy if you have $250 right now.

Ticker Company Current Price
INTC Intel Corporation $37.34
WBA Walgreens Boots Alliance, Inc. $39.67
KO The Coca-Cola Company $57.09
MRK Merck & Co., Inc. $84.89
WMT Walmart Inc. $120.62
JPM JPMorgan Chase & Co. $113.43
CVX Chevron Corporation $155.48

Dow Stocks: Intel (INTC)

Intel Stock is Long Overdue for a Substantial Pullback After Solid Beat
Source: dennizn / Shutterstock.com

Semiconductor and technology specialist Intel (NASDAQ:INTC) is one of the hardest-hit names, putting INTC into the speculative discount category among Dow stocks to buy. With shares plunging 27% on a year-to-date basis, the idea here is to gamble that at some point, the tech firm will make its way higher. During the interim, you can collect its 3.9% dividend yield.

While that doesn’t initially sound like a pleasant narrative, the main focus for Intel investors is its vast business footprint, which ranges from data centers to personal computers to artificial intelligence and machine learning. The latter two categories is especially intriguing because of long-term projections.

According to Grand View Research, experts forecast that by 2030, sector revenue for the global AI market will hit $1.81 trillion. This tally represents a staggering compound annual growth rate (CAGR) of 38.1% from 2022 to the end of the forecasted period.

Finally, an important anecdote: the cryptocurrency market launched during the Great Recession, meaning that tech never sleeps, even during economic downturns.

Walgreens Boots Alliance (WBA)

Walgreens (WBA) store exterior and sign in Pompano Beach, Florida
Source: saaton / Shutterstock.com

To be fair, while tech itself never sleeps, it doesn’t necessarily mean that every competitor in the space will be successful – far from it. To reduce the level of risk for your Dow stocks to buy but still maintain upward potential in choppy waters, you might want to direct your attention to Walgreens Boots Alliance (NASDAQ:WBA).

Operating the second-largest pharmacy store chain in the U.S., Walgreens (under the WBA parent organization) has fortuitously enjoyed significant relevance because of the coronavirus pandemic. Primarily, you can conveniently schedule your Covid-19 vaccine if you so wish. Further, it’s quite possible that should the monkeypox outbreak get out of hand, Walgreens will receive another dose of good fortune.

Second, the global pharmacy market size is poised to grow from $1.07 trillion in 2021 to $1.63 trillion by 2030, representing a CAGR of 4.7%. While it’s not the most page-turning growth stat, the consistent flow of consumer demand helps make WBA one of the best Dow stocks to buy.

Coca-Cola (KO)

Source: phloxii / Shutterstock.com

Just for pure marketing smarts, you might want to add Coca-Cola (NYSE:KO) shares to your list of Dow stocks to buy. Recently, the soft-drink giant made headlines when it announced a partnership with Brown-Forman (NYSE:BF.A, NYSE:BF.B) to combine the Coke and Jack Daniel’s Tennessee Whiskey brands into one alcoholic beverage.

Interestingly, Coca-Cola has been aggressively expanding its alcohol drink options, per a CNN Business report. Cynically, some evidence indicates that as the economy goes down, drinking goes up. So, the iconic beverage firm is in the right business as far as I can tell.

Seriously, though, Coca-Cola’s traditional business has historically been pegged as a recession-resistant investment. Fundamentally, part of the reason stems from the “cheap respite” thesis. We all need a break during hard times and a sugary drink can provide the endorphins necessary to get us going.

Also, consumers may skimp out on expensive lattes and switch to Coke products, thus benefitting the underlying company.

Dow Stocks: Merck (MRK)

Merck (MRK) logo outside of corporate building
Source: Atmosphere1 / Shutterstock.com

Easily one of the best Dow stocks to buy should a recession hit us, pharmaceutical giant Merck (NYSE:MRK) doesn’t need an extra shot of relevance. However, it got one anyways in 2020 when the Covid-19 crisis broke out. Suddenly, the public at large was more vested in pharmaceutical and biotech innovations. And this impact could be felt for generations much like an economic crisis can leave a permanent imprint on young people.

But as fears of Covid-19 itself fades, Merck stands to benefit again. According to data from the Centers for Disease Control and Prevention, “an estimated 40.9% of U.S. adults have avoided medical care during the pandemic because of concerns” related to the SARS-CoV-2 virus. But now that the crisis is slipping into the rearview mirror, it’s excellent news for Merck’s top-tier pipeline.

Specifically, treatments like Keytruda – Merck’s top product – can be distributed more widely as the healthcare system normalizes. Therefore, MRK is one of the Dow stocks to buy on a favorable pivot.

Walmart (WMT)

Image of Walmart (WMT) logo on Walmart store with clear blue sky in the background
Source: Harun Ozmen / Shutterstock.com

I’m going to preface the inclusion of Walmart (NYSE:WMT) with a caveat: I fully understand that WMT is risky based on the circumstances. Mainly, the consumer is getting absolutely rocked with inflation, which has contributed to a worrying decline in the dollar’s purchasing power. Plus, Walmart and other big-box retailers made some inventory forecasting boo-boos when they failed to account for experience-based demand (i.e., revenge traveling) stealing share from demand for physical goods.

Still, let’s be brutally honest: Walmart is one of the Dow stocks to buy because a recession could boost its profile, relatively speaking. As the pioneer of everyday low pricing, Walmart is built for a downturn. Heck, every time I walk into one of its stores, I get a depressing feeling.

In full transparency, from the perspective of technical analysis, WMT gap down moves following its most recent earnings report is troubling. Thus, prospective investors may want to wait a bit before diving in. Still, this is one of the Dow stocks to buy on discount as shopping won’t stop altogether – and Walmart knows how to offer this as cheaply as possible.

JPMorgan Chase (JPM)

JPMorgan Chase (JPM) lettering on a corporate office in New York City.
Source: Roman Tiraspolsky / Shutterstock.com

Personally, I’m not exactly the greatest fan of big banks like JPMorgan Chase (NYSE:JPM). While a higher interest rate environment theoretically helps JPM and its ilk through the ability to charge higher lending fees, the bigger concern is the stability of the economy. At some point, borrowing costs will get too onerous, thus killing risk incentive and broader growth.

Still, one area that could do really well for JPMorgan Chase is its wealth management division. You see, during a bull market, any Tom, Dick and Harry with a YouTube channel can give seemingly prescient advice. However, did you notice how these gurus look a little silly now that a certain cryptocurrency was struggling at $20,000?

Well, that’s where JPM and its wealth managers come into the picture. These folks are the real experts, having guided high-net-worth clients through bull and bear markets. So, if they can get the proper messaging out, JPM could be a surprising idea among Dow stocks to buy.

Dow Stocks: Chevron (CVX)

Source: JL IMAGES / Shutterstock.com

The majority of the Dow stocks to buy on this list suffered significant market losses, thus drawing the attention of speculators. That’s not the case at all with oil giant Chevron (NYSE:CVX). With Exxon Mobil (NYSE:XOM) kicked out of the Dow 30, Chevron is basically the last of the Mohicans. And CVX is representing its sector well, gaining over 32% in 2022.

Technically, it’s on a small discount, down 12% over the trailing five days. But that’s not exactly why I’m mentioning CVX. Rather, the oil and gas market appears primed to rise higher throughout this year, if not into 2023. Of course, the catalyst is Russia’s destabilizing invasion of Ukraine, which has effectively shelved a significant portion of global energy flows, thus dramatically raising prices.

Interestingly, U.S. energy companies are reluctant to start new oil drilling projects because many in the industry are unsure whether high prices will stay elevated long enough for investors to make a profit. In my opinion, this decision to stay on the sidelines is short-sighted but that’s cynically good news for CVX.

On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare.


Article printed from InvestorPlace Media, https://investorplace.com/2022/06/7-smartest-dow-stocks-to-buy-if-you-have-250-dollars/.

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