Dow Jones stocks Boeing, UnitedHealth, Caterpillar, Chevron and Goldman Sachs are in focus this week.
The Dow Jones Industrial Average has been leading the current market rally, hitting a seven-month high recently. While it's made up of just 30 stocks, the Dow Jones index reflects broader strength in industrials, financials, medicals and energy stocks.
All five of these Dow stocks are near buy points, with some potentially actionable.
The overall market uptrend made progress this past week, with the S&P 500 retaking its 200-day moving average, holding that key level on Friday despite a hot jobs report.
Chevron stock is on IBD Leaderboard. Boeing stock is on SwingTrader.
Dow Jones Stocks: Boeing
BA shares popped 4% to 182.87 in Friday's market trading, slightly extended from a 173.95 cup-base buy point. Investors could use recent short-term highs as alternate entries. On the week, Boeing stock climbed 2.5%.
Boeing stock rebounded higher Friday after the Wall Street Journal reported United Airlines is near a deal to buy "dozens" of 787 Dreamliners.
After a huge run-up, Boeing stock had paused had over the past few weeks, letting the 21-day moving average close the gap.
Boeing stock began its rebound in late September. That was briefly interrupted with a last reversal on Oct. 26, as Boeing posted a surprise third-quarter loss, with defense segment challenges offsetting commercial aviation gains.
But in early November, Boeing said it expects to deliver about 375 of its top-selling 737 jet in 2022, rising to 400 to 450 next year. By 2025-26, Boeing is forecasting about 800 commercial deliveries, including the 737 and the 787 Dreamliner. In October, Boeing said it had delivered 277 units of the 737 jet and nine units of the 787, the company said earlier in October.
All those future jet sales will contribute to much stronger cash flow in the coming years, Boeing said.
Boeing's top-selling 737 Max returned to service in December 2020 after two fatal flights led to worldwide groundings. Deliveries of the 787 resumed last quarter after manufacturing issues. Plane makers receive the bulk of payment from airlines and other customers after jets are delivered.
Boeing suffered from the collapse in commercial and business air travel during the pandemic. It also faced setbacks to key defense programs. The company is working on a turnaround while recession fears grow and supply disruptions persist.
Analysts expect Boeing to earn 32 cents per share in Q4, up from a loss of 7.69 per share a year ago. Wall Street forecasts revenue growing 34% to $19.8 billion.
In 2023, Boeing is expected to post a profit after four years of losses.
Dow Jones stock Boeing has a Composite Rating of 47. It has a 93 Relative Strength Rating, an exclusive IBD Stock Checkup gauge for share price movement. The EPS rating is a lowly 1.
Caterpillar Stock
CAT stock edged up 0.2% to 236.13 Friday, also up 0.2% on the week.
Shares are pausing around a still-valid 238 buy point from a cup base going back to April, according to MarketSmith analysis. Investors could use 239.95 as another buy point, either as a high handle to the seven-month cup base or as a traditional handle to a larger consolidation starting in June 2021.
The Dow Jones stock CAT has forged a 46% rally since bottoming in late September. The six-week run — including an 8% jump on blowout Q3 earnings — has been taking a breather since Nov. 14, while trading in a tight range.
The Deerfield, Ill.-based construction and mining equipment giant handily beat earnings estimates on Oct.27. The company reported that EPS shot up 48% to $3.95. Revenue jumped 20% to $14.9 billion.
The Street forecasts Q4 earnings per share revving up 48% to $3.97 while sales are expected to edge up 14% to $15.8 billion.
Caterpillar stock was Thursday's IBD Stock Of The Day. On Wednesday, fellow heavy equipment maker Titan Machinery soared 26% after it beat earnings and revenue views with its third-quarter 2023 results.
Other heavy equipment names including Deere, Cummins and United Rentals are also showing signs of strength in the current market.
With the global economy potentially sliding toward recession in 2023, the timing seems unusual for CAT stock to be making a big move. Even in a soft landing, residential construction, which accounts for 25% of Caterpillar's construction industry sales, is going into the tank.
The Dow Jones stock CAT has a 94 IBD Composite Rating. Its Relative Strength Rating is 93 and its EPS Rating is 85.
UnitedHealth Stock
UNH stock lost 0.1% to 536.16 Friday. On the week, shares dipped 0.3%. That weekly action included a 3.7% gain Wednesday, a rebound from the 21-day and 50-day lines in heavy volume.
As of Friday's close, UNH stock has a flat base with a 558.20 buy point, next to a prior cup-with-handle base.
Investors could buy UnitedHealth stock above Thursday's high of 553. There's a lot of trading around that area, including a prior 553.29 buy point.
Health care plays, including UnitedHealth stock, continue to hold up, as they tend to be more insulated from inflationary pressures. UNH stock has outperformed the broader market for long stretches in 2022.
UnitedHealth's business model aims to contain health costs for its managed care arm, partly by insourcing health services to its own cost-efficient locations. UNH's health insurance arm, UnitedHealthcare, is the largest health insurance company, based on membership, in the country.
Minnetonka, Minn.-based UnitedHealth is also coming off solid third-quarter earnings. The managed care giant increased its profit outlook after beating earnings estimates for Q3 on Oct. 14.
UnitedHealth earnings rose 28% to $5.79 a share, the second straight quarter of accelerating growth. Revenue rose nearly 12% to $80.894 billion.
Analysts expect EPS in Q4 to grow 32% to $5.90. Sales are forecast to jump 12% to $82.3 billion, according to FactSet.
In terms of ratings, UNH stock sits second in the Medical-Managed Care industry, behind Humana.
The Dow Jones stock has a 93 Composite Rating out of 99. It has a 85 Relative Strength Rating. The stock's EPS rating is 94.
Dow Jones Stocks: Chevron
CVX shares fell 0.8% to 181.03 Friday, slightly below the 182.50 buy point and just under the 21-day line. For the week, Chevron was down about 1.45%. CVX stock has been trading around that official buy point all month.
Crude oil prices had been falling back again but rebounded last week amid a number of crosswinds.
Crude futures initially felt some pressure as the White House eased oil sanctions on Venezuela. That will let Chevron resume oil production in the Latin American nation, for at least a six-month period.
But signs that China will ease its Covid policies helped buoy crude oil prices. Meanwhile, it's possible that OPEC+, which includes Russia, may announce an oil output cut when the cartel meets Sunday.
In late October, Chevron topped third-quarter earnings views. Chevron reported EPS surging 88% to $5.56. Sales increased 59% to $66.6 billion in the third quarter.
Wall Street expects earnings to get a 76% boost to $4.51 per share in Q4. Revenue is predicted to edge up 18% to $56.6 billion, according to FactSet.
California-based Chevron ranks ninth in IBD's Oil&Gas-Integrated industry group. CVX stock has a 94 Composite Rating and a Relative Strength Rating of 94. Additionally, it has an 79 EPS Rating.
Goldman Sachs Stock
GS stock edged down 0.8% Friday to 380.58. On the week, shares were down 2.1%. The investment bank has a 389.68 buy point from a 35%-deep cup-with-handle base going back to November 2021.
Investors also could view the recent pause as a shelf just above the buy range from a bottoming base that Goldman stock cleared in early November.
The 21-day moving average has nearly caught up, while the 50-day line is starting to gain ground. The relative strength line is at a multiyear high, reflecting GS stock's outperformance vs. the S&P 500.
On Oct. 18, Goldman topped earnings estimates with its third-quarter results. The investment bank and financial services firm reported earnings dropped to $8.25 per share, down 44%, as revenue fell to $11.98 billion, sliding 12% over the year.
Goldman Sachs' investment banking revenue fell 57% over the year to $1.58 billion as the company saw significant decreases in corporate lending, financial advisory and underwriting revenue. But Global Markets revenue rose 11% to $6.2 billion, driven by growth from its Fixed Income, Currency and Commodities (FICC) segment.
FICC sales leapt 44% to $3.53 billion on substantial increases in revenue for interest-rate products, currencies, commodities and credit products. However, Goldman noted significant declines in mortgage revenue but saw increases in financing and mortgage lending revenue.
Analysts forecast Q4 EPS dropping 32% to $7.36 while revenue is expected to fall 10% to $11.3 billion.
Dow Jones stock Goldman Sachs ranks third in the Banks-Money Center industry group. GS has a Composite Rating of 86. Its Relative Strength Rating is 89 and its EPS Rating is 58.
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