3 Stocks Falling Behind the Dow
Nov 6th 2012 1:05PM
Updated Nov 6th 2012 1:08PM
On this historic election day, the Dow Jones Industrial Average (INDEX: ^DJI) is surging higher, and only one of the 30 components has missed the rally today. As of 12:50 p.m. EST, the index is up 139 points, or just more than 1%, to 13,251. While we don't yet know the outcome of the election, investors seem rather confident that we will by the end of the day. In elections, life, and the stock market, not everyone can win, even if they are good candidates, people, or companies. Let's take a look at some of the Dow stocks that have been unable to win the race against the benchmark index this year.
So why are they down?
Hewlett-Packard is easily the worst-performing Dow component this year. The stock price has lost about 44% year to date, while the Dow has increased by 8.39% during the same time frame. This year has been tough for PC makers and chip providers like Intel (NAS: INTC) , which is the third-biggest Dow loser, having watched its stock decline 10.33% year to date. The consumer preference shift from PCs to tablet computers has left PC-oriented companies struggling to turn profits. Unless Hewlett-Packard and Intel can find their place in the tablet world, the next few years may prove difficult for both the companies and their shareholders.
McDonald's of the mighty yellow arches is the second-biggest Dow loser this year. Its shares are down 12.37% year to date. The company has been fighting an uphill battle this year. It's up against strong year-over-year same-store sales comparisons, and higher commodity prices are pinching margins. While current shareholders never want to see their stock lose value, those of us sitting on the sidelines have been saying, "I'm loving it." The company now trades at 16 times past earnings, boasts a 3.5% dividend yield, and is still No. 1 in the fast-serve restaurant business. Investors looking to buy and hold for the long term for a reduced price can't go wrong buying McDonald's at this time.
Finally, Boeing, the U.S.'s largest airplane manufacturer, has seen better years. The stock is down 2.15% year to date and thus losing to the Dow by more than 10%. The company had its first domestic commercial flight of its 787 Dreamliner yesterday, which should give investors' confidence in the 787program moving forward. The Dreamliner planes have been delayed for three and a half years due to a new airplane design which uses lighter materials, making the aircraft more fuel-efficient. Just a few weeks ago the company also increased production at a number of plants in an attempt to reduce its order backlog.
With great opportunity comes great responsibility. For Boeing, which operates as a major player in a multitrillion-dollar market, the opportunity is absolutely massive. However, the company's execution problems and emerging competitors have investors wondering whether Boeing will live up to its shareholder responsibilities. In this premium research report, two of The Fool's best industrial minds have collaborated to provide investors with info on the must-know issues concerning Boeing. They'll be updating the report as key news hits, so be sure to claim a copy today by clicking here now.
The article 3 Stocks Falling Behind the Dow originally appeared on Fool.com.Matt Thalman has no positions in the stocks mentioned above. The Motley Fool has no positions in the stocks mentioned above. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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