7 Dow Stocks at a Reasonable Price

Stocks might be hitting all-time highs, but there still are bargains to be found, especially among the blue-chip stocks in the Dow Jones Industrial Average.

3d render closeup of computer keyboard with DJIA index button. Stock market indexes concept.
(Image credit: Getty Images)

Stocks might be hitting all-time highs, but there still are bargains to be found, especially among the blue-chip stocks in the Dow Jones Industrial Average. The exclusive club of 30 Dow stocks is bristling with names that remain reasonably priced even as the industrial average approaches its own all-time closing high of 26,616.71 set on Jan. 28, 2018.

Whether they’re beaten-down value plays or stocks that don’t adequately reflect their companies’ long-term earnings growth, plenty of Dow Jones stocks are on sale.

The Standard & Poor’s 500-stock index currently trades at 16.6 times expected earnings, according to data from Thomson Reuters. With that as our starting point, we screened the Dow for stocks with forward price-to-earnings multiples of less than 16.6. Next, we looked at projected earnings growth rates, historical valuations, analyst commentary and broker recommendations. Lastly, we looked at dividend yields, which are an important component of future total returns.

After applying those criteria, these names stand out as great Dow stocks trading a reasonable price.

Disclaimer

Data is as of Aug. 29, 2018. Companies are listed alphabetically. Dividend yields are calculated by annualizing the most recent quarterly payout and dividing by the share price. Forward price-to-earnings (P/E) multiples provided by Thomson Reuters. Analysts’ opinions provided by Zacks Investment Research.

Dan Burrows
Senior Investing Writer, Kiplinger.com

Dan Burrows is Kiplinger's senior investing writer, having joined the august publication full time in 2016.


A long-time financial journalist, Dan is a veteran of SmartMoney, MarketWatch, CBS MoneyWatch, InvestorPlace and DailyFinance. He has written for The Wall Street Journal, Bloomberg, Consumer Reports, Senior Executive and Boston magazine, and his stories have appeared in the New York Daily News, the San Jose Mercury News and Investor's Business Daily, among other publications. As a senior writer at AOL's DailyFinance, Dan reported market news from the floor of the New York Stock Exchange and hosted a weekly video segment on equities.


Once upon a time – before his days as a financial reporter and assistant financial editor at legendary fashion trade paper Women's Wear Daily – Dan worked for Spy magazine, scribbled away at Time Inc. and contributed to Maxim magazine back when lad mags were a thing. He's also written for Esquire magazine's Dubious Achievements Awards.


In his current role at Kiplinger, Dan writes about equities, fixed income, currencies, commodities, funds, macroeconomics, demographics, real estate, cost of living indexes and more.


Dan holds a bachelor's degree from Oberlin College and a master's degree from Columbia University.


Disclosure: Dan does not trade stocks or other securities. Rather, he dollar-cost averages into cheap funds and index funds and holds them forever in tax-advantaged accounts.