The 30 Dow Industrials are perhaps the most widely watched stocks on the planet. Investors from Hong Kong to Bahrain all take their trading cues from the Dow's latest performance. Yet the stocks on the index are anything but monolithic in their movements. Since the year began, the Dow's proxy, the SPDR Dow Jones Industrial Average ETF (NYSE:DIA) has risen by 9%. Yet the individual components of the index have reaped returns anywhere from -17% to 44%.
Below, we highlight the best of the bunch with 2010's leading Dow Industrial stocks, complete with fundamentals and the news that's driven them higher than their peers. (For related reading see, Index Investing: The Dow Jones Industrial Average.)
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The Earth Moved
Caterpillar, Inc. (NYSE:CAT) makes earth moving machinery for the construction and mining businesses. The company's shares have risen better than 44% in 2010 and currently trade with a dividend yield of 2.14%. Price-to-earnings on the shares is 27.12.
Two thirds of Caterpillar's float is held by institutional investors, who apparently like the company's ability to grow. Most recently that growth came about through acquisition. Caterpillar bought German engine maker MWM Holding GmbH in a cash deal that cost $810 billion.
Last month Caterpillar announced plans to significantly expand its production facilities in China. And President Obama, on his recent trip to India, named Caterpillar as one of a pair of American corporations that are in the bidding to supply India's railways with 1,000 diesel locomotives over the next ten years.
E.I. du Pont de Nemours & Company (NYSE:DD) stock is up over 40% in 2010, a far cry greater than the Materials SPDR ETF(NYSE:XLB), of which it is a component. XLB has risen around 8.4% over the same period and pays a 1.5% dividend. Du Pont shares pay a 3.4% dividend and trade with a P/E of 14.1.
Du Pont is in the chemical business, producing a vast array of products for use in the agriculture, food, electronic, transportation, communications and building industries.
A Du Pont employee was killed in an explosion at a plant in Buffalo New York this week.
The Boeing Company (NYSE:BA) pays a dividend of 2.5% and trades with a multiple of 14.8x last year's earnings. Since New Year's Boeing has soared to a gain of 24%. That will please the institutional investor set, who own 73% of the company's outstanding float.
In just the last month Boeing has received orders for at least 50 more of its new 737s.
The Bottom Line
Hunting for stock treasures doesn't mean looking beyond the biggest, most well-known names in American industry. The Dow's leaders are keeping pace with the best and brightest from every sector.
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