Why Apple Isn't the Only Dow Stock That Analysts Are Thrilled About

Investing

Published: August 5, 2017 9:10 am

Last Updated: January 12, 2020 9:25 am

This current earnings season has been a roller-coaster for Dow stocks. Although a few have underperformed, there have been a couple that have completely changed the game. In the final week of July, Boeing Co. (NYSE: BA) knocked it out of the park and the stock rose over 13%, and this past week Apple Inc. (NASDAQ: AAPL) helped to push the Dow past the 22,000 mark. However, it wasn’t just Boeing and Apple that sent the Dow screaming to all-time highs.

A few analysts released reports this past week calling for three Dow stocks to rise even higher (at least 10%). At this rate, it seems that the 23,000 mark is just around the corner.

Here 24/7 Wall St. has included some of the need-to-know highlights from each of these reports, as well as how much higher analysts are calling for these Dow stocks to go.

Independent research firm Argus was very positive on Caterpillar Inc. (NYSE: CAT). The firm issued a Buy rating with a $130 price target, versus a $113.10 prior closing price, implying 15% upside.

Argus detailed in its report:

We see signs that business is clearly improving and valuations remain attractive, despite a recent move to the upside in the share price. This well-managed firm has a strong balance sheet and a focus on returning capital to shareholders. The business is highly cyclical, and various commodity and currency trends are now finally beginning to turn in the company’s favor. Meanwhile, management has been aggressively cutting costs. In the most recent calls, management has highlighted some positive developments at its end markets. Moreover, on a macro basis, key commodity prices have begun to firm, which could lead to better results for the company for the next several quarters. Despite the recent share price advance from cycle lows, the shares appear to offer value, and we see strong growth ahead.

Shares of Caterpillar closed out the week at $114.35. The stock has a 52-week trading range of $79.93 to $114.90, and a consensus price target of $118.63.

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Oppenheimer took a look at Wal-Mart Stores Inc. (NYSE: WMT) and launched coverage with an Outperform rating and a $90 price target. That compared with an $80.50 closing price, implying nearly 12% upside.

In the brokerage firm’s view, a renewed focus at the company on superior store-level execution and a much more concerted effort online render the Walmart story “fresher than it’s been in years.” Key metrics such as traffic and comp sales have picked up lately. Oppenheimer is looking toward fiscal 2018 as the first year of more meaningful positive earnings growth for Walmart since fiscal 2013.

Shares of Walmart were last seen at $80.48, with a consensus analyst target of $80.97 and a 52-week range of $65.28 to $81.76.

And BMO Capital Markets issued a call on Pfizer Inc. (NYSE: PFE). The pharma giant was upgraded to Outperform from Market Perform and the price target was raised to $37 from $33. That compared with a $32.76 prior closing price and implies upside of 13%.

The brokerage firm believes Pfizer appears to have a number of potential blockbuster growth opportunities. The kicker is that half of these could be approved by 2020, and the company does not expect significant impact from loss of exclusivity from 2020 to 2025. BMO believes that this could lead to a relatively steady 2% to 3% revenue growth over the next few years.

Shares of Pfizer were trading at $33.64, within a 52-week range of $29.83 to $35.53. The consensus price target is $37.60.