Investing in the Dow Jones Industrial Average companies can be likened to facing off with the legendary boxer Mike Tyson. Just like a match with Iron Mike, it may seem dull at first glance, but the potential for remarkable gains should not be overlooked.
The surprise announcement of Tyson’s return to the ring against a YouTube sensation like Jake Paul may have initially appeared as a farce. Nevertheless, one wouldn’t dare underestimate the power he still possesses in his fists. Similarly, the Dow heavyweights, with their enduring presence, may not always deliver extraordinary returns, yet they possess the capacity to surpass expectations time and time again. These companies have the potential to go the distance and reward investors along the way.
Honeywell (HON)
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Honeywell (NASDAQ:HON), an industrial and applied sciences conglomerate, plays a vital role in various sectors, including aerospace technologies, building automation, and energy solutions. Strong in industrial automation, HON stock faced a nearly 5% decline since the year’s commencement, modestly up about 5% over the trailing year.
However, what sets HON apart and makes it an attractive Dow stock is its consistency. In the previous fiscal year, the company surpassed earnings per share expectations in all four quarters, with an average positive earnings surprise of 2.6%. While this may not be an exceptionally high figure, many businesses would be content with such a track record.
Analysts estimate that Honeywell will report earnings per share of $9.96 on revenues of $38.51 billion this fiscal year. The most optimistic outlook projects EPS of $10.1 on revenue of $38.83 billion. In comparison, last year’s profits per share stood at $9.16 on a topline of $36.66 billion.
Currently, experts rate HON as a strong buy with an average price target of $227.73, indicating a potential upside of over 14%.
Amgen (AMGN)
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Amgen (NASDAQ:AMGN), a leading biotechnology company that specializes in developing and delivering human therapeutics globally, has seen its stock price decline by close to 9% since the beginning of the year.
Despite this recent setback, Amgen remains an attractive option among Dow stocks due to potential value. The company boasts a consistent track record of delivering solid results. Notably, it surpassed earnings per share targets for the previous fiscal year, with an average positive earnings surprise of nearly 6%.
For the current fiscal year, analysts project that Amgen will achieve earnings per share of $19.57 on revenues of $33.02 billion. The previous year saw the company earn $18.65 per share on revenue of $28.19 billion. Looking forward to fiscal 2025, estimates suggest sales could reach $34.16 billion with per-share profits hitting $21.12.
Analysts have assigned Amgen a consensus moderate buy rating, with a price target of $312, indicating potential growth of almost 15%.
UnitedHealth (UNH)
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UnitedHealth (NYSE:UNH), a diverse healthcare corporation, is a stalwart among Dow stocks. Operating through four key segments, UnitedHealth offers health benefit plans and services to a broad spectrum of clients, ranging from national employers to individuals, with specialized services like administering Medicaid plans.
Although UNH stock currently bears increased risk due to recent cybersecurity issues impacting its IT network and service disruptions, there is potential for an upswing given the company’s consistent performance history.
In the previous fiscal year, UnitedHealth outperformed earnings per share estimates in all four quarters, achieving an average positive earnings surprise of 2.85%. Analysts anticipate earnings per share of $27.77 on revenues of $401.02 billion for the current fiscal year. Comparatively, the company reported profits per share of $25.12 on revenue of $371.62 billion last year.
With a consensus strong buy rating from analysts and a price target of $591.29, UnitedHealth shows the potential for nearly 20% upside.
As of the publication date, Josh Enomoto did not have (either directly or indirectly) any positions in the securities discussed in this article. The opinions expressed here represent those of the author and are in accordance with the InvestorPlace.com Publishing Guidelines.
