The Dow Jones Industrial Average is a stock index comprised of 30 of the largest blue-chip companies in the U.S. Because of its number of component stocks, the index is commonly known as the Dow 30. Taken together, the stocks in the Dow are meant to provide a snapshot of the U.S. economy and how it is performing.
The Dow has come under criticism in recent years for its continued underperformance versus the two other major U.S. stock indices. Critics point to the fact that the Dow is up only 2% this year versus a 15% increase in the benchmark S&P 500 index and a near 20% rise in the Nasdaq Composite. Despite the criticism, some stocks in the index have outperformed by a wide margin, and analysts are extremely bullish on them.
Here are three strong buy Dow stocks to consider in June 2024.
Amazon (AMZN)
Amazon (NASDAQ:AMZN) is a new component of the Dow 30, having been added to the index earlier this year. But it’s one of the stocks that analysts are most bullish on. Amazon stock currently has a Strong Buy rating, with all 42 analysts who cover the company rating it a Buy. There are no Hold or Sell ratings on the stock. And although AMZN stock has risen a healthy 46% in the last 12 months, analysts see more upside ahead. The median price target on the shares is 20% higher than where they currently trade.
Analysts are bullish on Amazon’s prospects, particularly as its cloud computing business unit continues to dominate and the company’s revenues get a boost from a resurgence of online advertising. Amazon is also winning praise for right-sizing its e-commerce business after the pandemic and growing its Prime streaming service, securing a lucrative broadcast deal with the National Football League. So far in 2024, Amazon stock has gained 21%.
Walmart (WMT)
Walmart (NYSE:WMT), the world’s largest retailer and Amazon competitor, also rates a Strong Buy among analysts who track the company’s progress. Of the 28 professional analysts offering a rating on WMT stock, 25 call it a Buy, while 3 have a Hold rating on it. There isn’t a single Sell rating on the stock. The median price target on the shares is almost 10% higher than their current levels. The bullish outlook comes as Walmart’s stock enjoys a very good year.
So far in 2024, Walmart stock has risen 28%, marking one of the best starts in recent memory for the company. Currently trading at an all-time high, Walmart split its stock on a 3-for-1 basis this February. The shares have continued rallying since the split. Analysts view Walmart as a best-in-class retailer and praise the company for distinguishing itself from many of its floundering competitors, such as Target (NYSE:TGT).
The key to Walmart’s success, say analysts, has been its push into groceries. The company is now the largest grocery retailer in the U.S.
Coca-Cola (KO)
Coca-Cola (NYSE:KO) continues to be a favorite among analysts. Coke’s stock has a Strong Buy rating, with 13 Wall Street analysts giving it a Buy recommendation and 3 analysts labeling it a Hold. There are no Sell ratings on KO stock. The consensus view is that Coca-Cola’s share price will rise 8% higher over the coming 12 months. The bullish outlook comes despite the fact that the stock is up only 6% this year, trailing the 15% gain in the benchmark S&P 500 index.
Despite the underperformance, analysts continue to like Coca-Cola’s stability and strong brand, which they say gives the company pricing power or the ability to raise prices without losing customers. Analysts also like Coca-Cola’s dividend. The company pays a quarterly distribution of 48 cents a share, giving the stock a yield of 3.10%. Coke has raised its dividend for 62 consecutive years, making it one of the most consistent shareholder payments.
On the date of publication, Joel Baglole did not hold (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.