The Dow Jones Industrial Average is an index that tracks 30 stocks representing large US companies. Because the index is composed of U.S. industry leaders it is broadly equated to the US economy overall. The U.S. economy is the world’s largest and thus the Dow 30 tends to represent the most stable investments overall. This has led to my list of dependable Dow stocks for investors to consider.
It’s very easy to currently argue that investors are seeking dependability and stability overall. Doubts about Fed rate cuts have reintroduced instability to the stock market. I believe that investors who were warming up to the idea of growth prospects on lower lending rates will now pivot back into more stable investments like those the Dow offers. Stability and a worry-free portfolio will now command a higher premium than they did until very recently.
So, with that being said, let’s look at three dependable dow stocks to consider buying.
American Express (AXP)
American Express (NYSE:AXP) And other credit card stocks have proven their strength over the past few years. American credit card debt continues to surge to all time highs providing reason to believe that AXP shares will continue to grow moving forward.
2023 was an exceptionally strong year for the company with revenues and earnings per share both growing by 14%, respectively. Earnings per share surged during the 4th quarter, increasing by 27%. the strong performance was an indication that American Express will continue to reward investors.
Yet, in the stock market it is not the past that matters but instead the future. There too, American Express looks strong. It is expected that American Express will show 10% revenue growth and earnings per share increases near 25% when it releases its earnings report soon.
Further, American Express tends to serve a wealthier clientele base than other credit card firms. Thus, it tends to have a lower credit risk overall which is another signal of its dependability. This make it one of those dependable Dow stocks for investors to consider closely.
McDonald’s (MCD)
McDonald’s (NYSE:MCD) has long been recognized as a dependable stock. There is no more recognizable restaurant globally and that fact is testament to the strength of the firm.
McDonald’s is very dependable from the perspective that customers know they will receive the same meal in middle America as they will in the Middle East. It’s also a very dependable, stable stock overall recognized for strong earnings, dividends, and worry-free growth.
During 2023 McDonald’s saw overall sales grow by 10% and net income grow by 37%. As impressive as those results are, investors should expect further growth from the company. The company is targeting its fastest rate of historical growth between now and 2027. There were more than 41,000 McDonald’s franchises globally at the end of 2023. McDonald’s intends to increase that number to 50,000 by 2027.
Thus, it’s likely that investors in MCD stock can expect a more potent mix of stability with higher growth in the coming years. It’s also one of those dependable Dow stocks to buy.
Walmart (WMT)
Walmart (NYSE:WMT) is the clearest stock choice among retail shares. It continues to lead the retail space and essentially only has a single challenger in e-commerce giant, Amazon (NASDAQ:AMZN).
Walmart reported $648 billion in revenues in 2023 while Amazon’s sales were slightly lower, at $574.8 billion. Each firm has continued to try and replicate the strengths of the other. Amazon has made attempts to enter the brick and mortar retail space with very limited success. However, Walmart continues to make substantial strides in e-commerce. In fact, Walmart’s e-commerce sales eclipsed $100 billion in 2023 for the first time ever.
It’s difficult to see any massive flaw in Walmart’s strategy and execution. Beyond that, Walmart is a clear go to choice for consumers who continue to battle stubborn inflation. Walmart is poised to continue to dominate its traditional business while also making strides in e-commerce. That combination of a dominant strengths makes WMT shares very dependable and a nice addition to investors seeking a worry-free portfolio overall.
On the date of publication, Alex Sirois 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.
