You can't beat Dow Jones stocks for stability and defense in a down market. By the same token, the blue chip average won't always keep up in a rising market.
Case in point: the broader S&P 500 added about 22% on a price basis over the past year through the early days of February, while the "growthier" tech-heavy Nasdaq Composite gained 26%. The Dow Jones Industrial Average, by comparison, very much lagged the pack. The elite bastion of 30 mostly more mature industry leaders delivered comparatively poky upside of less than 16%.
You can blame the Magnificent 7 stocks for much of the Dow's underperformance. Of the mega-cap tech stocks driving the majority of the bull market's returns this year, only Microsoft (MSFT), Apple (AAPL) and Amazon.com (AMZN) could be found in the blue-chip average until mid-November. Replacing buy-and-hold bust Intel (INTC) with Nvidia (NVDA) should certainly help the Dow going forward. The fact that the Dow is weighted by price rather than market cap is another reason it's lagging the other main benchmarks.
The current state of concentrated returns notwithstanding, it's important to know the Dow's recent underperformance isn't all that abnormal. Half of the average's components are low-beta stocks. That means they tend to lag in up markets, but hold up better when everything is selling off. This low-beta skew can actually be quite advantageous to long-term investors.
After all, as bright a time as it's been for equity investors, downside risks very much remain. The new administration's regulatory and trade agendas look to be pro-growth, but could also help stoke a resurgence in inflation. As such, market participants eager for interest rate cuts have had to scale back their expectations.
Meanwhile, although recession fears have eased greatly, surveys of economists put the odds of recession hitting in the next year at about 26%. The New York Fed's yield-curve model assigns a similar probability to the U.S. entering a recession over the next 12 months.
Should such a change in market fortunes come to pass ... well, that's where Dow Jones stocks come in.
Dow Jones stocks ranked
This collection of industry-leading companies and dividend growth stalwarts with their fortress-like balance sheets can offer relative stability in tempestuous market times. From the best Dow dividend stocks to the most widely held blue chip stocks, components of the industrial average occupy top spots in the portfolios of hedge funds and billionaire investors. Warren Buffett's Berkshire Hathaway (BRK.B), in particular, is a huge fan of select Dow stocks.
To get a sense of which Dow Jones stocks Wall Street recommends at an increasingly uncertain time for equities, we screened the DJIA by analysts' consensus recommendations, from worst to first, using data from S&P Global Market Intelligence.
Here's how the ratings system works: S&P surveys analysts' stock calls and scores them on a five-point scale, where 1.0 equals a Strong Buy and 5.0 is a Strong Sell. Scores between 3.5 and 2.5 translate into Hold recommendations. Scores higher than 3.5 equate to Sell ratings, while scores equal to or below 2.5 mean that analysts, on average, rate shares at Buy. The closer a score gets to 1.0, the higher conviction the Buy recommendation.
In other words, lower scores are better than higher scores.
Please note that Nvidia replaced INTC in the gauge in November, while paint maker Sherwin-Williams (SHW) was swapped in for chemicals company Dow (DOW). Amazon.com (AMZN) was added to the Dow in February 2024, replacing Walgreens Boots Alliance (WBA).
See the table below for analysts' consensus recommendations on all 30 Dow Jones stocks, per S&P Global Market Intelligence, as of February 5, 2025.
