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5 Stocks in Dow ETF That Powered the Best Month Since 1987

Sweta Killa
·5-min read

Amid rising COVID-19 cases, the Dow Jones Industrial Average wrapped up its best month in more than 30 years after hitting the major milestone of 30,000 for the first time last week. The blue-chip index gained 11.8% in November. The slew of positive news about the COVID-19 vaccine and the optimism over President-elect Joe Biden led to a huge rally in the stocks (read: Dow Tops 30,000: 5 Stocks Driving the ETF).

Vaccine Updates

AstraZeneca AZN has been the latest drug maker to announce strong efficacy data about its vaccine candidate. An interim analysis of phase 3 trials conducted in the United Kingdom and Brazil revealed that its coronavirus vaccine reduced the risk of symptomatic COVID-19 by an average of 70.4%.

Earlier in November, Moderna MRNA and Pfizer PFE also reported encouraging data for their COVID-19 vaccine. Moderna’s vaccine candidate was 94.5% effective against coronavirus while Pfizer’s final phase 3 trial revealed that its COVID-19 vaccine candidate is 95% effective. Both the firms have filed for emergency use authorization with the FDA for its vaccine candidate.

Additionally, the FDA issued emergency use authorization for the Regeneron Pharmaceuticals REGN COVID-19 antibody cocktail (read: ETF Sectors to Bet on Positive Vaccine News).

Election Push

Democratic candidate Joe Biden is likely to gain control of the White House having become the presumptive president-elect of the United States while Republicans may keep the Senate. The combination will lead to favorable economic policies with reduced chances of major tax increases and tighter regulations.

Given the bullishness, SPDR Dow Jones Industrial Average ETF DIA tracking the Dow Jones Index has gained 10.4% last month. Let’s take a closer look at the fundamentals of DIA and its performance.

DIA in Focus

This is one of the largest and most-popular ETFs in the large-cap space with AUM of $25.3 billion and an average daily volume of 3.4 million shares. Holding 30 blue chip stocks, the fund is widely spread across components with each holding less than 7.5% share. Information technology (22.3%), healthcare (17.4%), industrials (16.9%), consumer discretionary (14%) and financials (13.2%), and are the top five sectors. DIA charges 16 bps in annual fees and has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook.   

Although most stocks in the fund’s portfolio delivered handsome returns last month, we have highlighted the five best-performing stocks in the ETF that led the way higher with their respective positions in the fund’s basket:

The Boeing Company BA: The stock has gained about 42% over the past month. It saw solid earnings estimate revision of $1.08 for this year over the past 30 days and has an expected earnings decline rate of 165.7%. Boeing currently has a Zacks Rank #3 (Hold) and a VGM Score of F. The stock takes the eight spot in the DIA portfolio with 4.7% exposure (read: 5 Sector ETFs That Beat the Market in November).

American Express Company AXP: This stock takes a 2.6% allocation in the fund’s basket and has gained 27% in the same time frame. The stock saw negative earnings estimate revision of 6 cents for this year over the past month and has estimated year-over-year earnings decline of 58.8%. American Express carries a Zacks Rank #3 and has a VGM Score of D.

The Walt Disney Company DIS: This stock takes a 3.3% allocation in the fund’s basket and has climbed 23.2% in a month. The stock saw negative earnings estimate revision of 57 cents for the fiscal year (ending September 2021) over the past month but has an estimated year-over-year earnings growth rate of 17.8%. Disney has a Zacks Rank #5 (Strong Sell) and a VGM Score of F.

Goldman Sachs Group GS: This stock takes the fourth spot and accounts for 5.1% of the assets in the fund’s basket. It has gained 21.3% and witnessed no earnings estimate revision over the past 30 days for this year. Its earnings are expected to decrease 9.3% from last year. Goldman has a Zacks Rank #1 (Strong Buy) and VGM Score of B. You can see the complete list of today’s Zacks #1 Rank stocks here..

Chevron Corporation CVX: This stock makes up for a 1.9% allocation and has gained 21% over the past month. The stock witnessed positive earnings estimate revision of 24 cents for this year over the past 30 days. It is expected to record year-over-year earnings decline of 100.5%. Chevron has a Zacks Rank #4 (Sell) and VGM Score of B.

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The Boeing Company (BA) : Free Stock Analysis Report
 
The Goldman Sachs Group, Inc. (GS) : Free Stock Analysis Report
 
Regeneron Pharmaceuticals, Inc. (REGN) : Free Stock Analysis Report
 
AstraZeneca PLC (AZN) : Free Stock Analysis Report
 
Chevron Corporation (CVX) : Free Stock Analysis Report
 
Pfizer Inc. (PFE) : Free Stock Analysis Report
 
American Express Company (AXP) : Free Stock Analysis Report
 
The Walt Disney Company (DIS) : Free Stock Analysis Report
 
Moderna, Inc. (MRNA) : Free Stock Analysis Report
 
SPDR Dow Jones Industrial Average ETF (DIA): ETF Research Reports
 
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