Created 128 years ago, the Dow Jones Industrial Average has long been the bellwether indicator of the health and direction of the United States economy. Originally comprised of just 12 industrial stocks, it carried a starting point of 40.94. Thus, investors must grab these stocks poised for unbeatable returns.
Although it’s been many years since the Dow was truly a barometer of industrial conditions, its broad strokes on economic activity still hold up well today. Yet none of those original companies are part of the index today. General Electric (NYSE:GE) had been on the DJIA until 2018 when it was finally replaced by Walgreens Boots Alliance (NASDAQ:WBA). The drugstore chain itself was just given the heave-ho just this year in favor of Amazon (NASDAQ:AMZN).
While the Dow is an ever-evolving matrix of companies they are a diverse cross-section of industry-leading global corporations. They offer investors the chance to find fantastic opportunities to build a transformative portfolio of wealth. The three companies below are Dow stocks for unbeatable returns to buy now and hold for the long-term.
Chevron (CVX)
While Chevron (NYSE:CVX) was not an original Dow stock, it does have a storied lineage of its own. The integrated oil and gas giant is a descendant of John D. Rockefeller’s Standard Oil Trust founded in 1870. Today it is a premier global energy company that has a bright future of growth ahead of it.
Chevron plans to increase its production to nearly 4 million barrels of oil equivalent per day (mmboe/d) by 2027 from about 3 mmboe/d at the end of last year. The new volume will come from its large, advantaged position in the Permian Basin, which should help deliver higher returns and greater profit margins.
The oil and gas stock also has premium assets in Guyana, an oil-rich nation currently being developed at an accelerated pace. Chevron’s $53 billion acquisition of Hess (NYSE:HES) will add to its assets in the country. However, rival Exxon Mobil (NYSE:XOM) says it has the right of first refusal over Hess’ Guyana fields. The acquisition may not come to fruition.
Even without Guyana, Chevron still boasts numerous other valuable assets. There are expansion projects in Kazakhstan, offshore gas fields in the Mediterranean, new developments in the Gulf of Mexico and new fields for discovery that it won in Brazil.
As fossil fuels still have a long road of growth ahead, expect Chevron to reap a windfall from them.
Disney (DIS)
Helped in part by activist billionaire investor Nelson Peltz launching a proxy battle, Disney (NYSE:DIS) stock is soaring in 2024, up 33% year-to-date. Yet fourth-quarter earnings were a pleasant surprise for the entertainment giant.
Theme parks continue to be a bright financial spot with revenue jumping 13% to $8.1 billion as domestic revenue rose 7%. However, its movies were brutalized last year as families don’t trust the company any longer to bring wholesome content to the big screen. Furthermore, while Disney dramatically cut its losses in streaming, it still represents a money-losing operation.
Yet you can’t bet against the House of Mouse. Disney owns timeless and iconic characters and franchises and also holds prime real estate in media including ESPN and Hulu.
Overall. the company is navigating the transition of consuming content to a direct-to-consumer model fairly well, albeit with hiccups along the way. Disney should achieve $7.5 billion in cut costs this year even as it increases capital spending by $1 billion. DIS stock forecasts $8 billion in free cash flow being generated in 2024. That is up 60% from the $5 billion it made last year.
With its dividend reinstated, momentum building behind its stock and a new path to profitability forged, Disney is a stock for the long run.
JPMorgan Chase (JPM)
Global money-center JPMorgan Chase (NYSE:JPM) is one of the few businesses benefiting from today’s high-interest rate environment. It adds billions of dollars in net interest income from the largest increase in rates in over 40 years.
Yet JPMorgan is also the dominant financial institution in the country, with leading franchises in investment and commercial banking, credit cards, retail banking, and asset and wealth management. It is one of the largest U.S. issuers of credit and debit cards. The bank is also one of the world’s largest asset managers with nearly $4 trillion in assets under management (AUM) at the end of 2023.
When the regional banking crisis flared up last year, it was JPMorgan Chase that rescued First Republic bank. The money-center also helped stave off a domino effect of collapsing banks.
A recession could impact the financial institution as loan delinquencies and defaults rise, wiping out profits. However, its scale puts it in an advantaged position, one it should be able to hold for years to come. If you are looking for stocks poised for unbeatable returns, start here.
On the date of publication, Rich Duprey held a LONG position in CVX, XOM and WBA stock. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
