The Dow Jones Industrial Average did away with the emerging coronavirus, supply chain, inflationary pressures, and a myriad of concerns to deliver an outstanding year in absolute terms. In fact, the Dow’s blue-chip fortress posted a 19% price gain through Dec. 30.
To get a sense of what 2021 was like beyond the stellar average, the Dow Jones’ 30-year annual price return is 8.7%.
Although the Dow as a whole has weathered the pandemic, there is no doubt that COVID-19 has taken a heavy toll in determining the average winners and losers in 2021, which we list in full below. Of course, the pandemic remains a key variable in the minds of Wall Street analysts as they assess the outlook for Dow Jones’s 30 stocks for 2022.
Either way, many of this year’s best Dow Jones stocks are expected to continue their battering market paths into the new year.
Takes Home Depot (HD, $409.94) and Microsoft (MSFT, $339.32), for example. The big 2021 Dow Jones stocks – each up more than half – are expected to post more significant gains in the coming year thanks to continuing current trends.
In the case of HD, the epidemic has led to changes in consumer consumption patterns. Stuck at home folks decide to feather their nests, embrace do-it-yourself (DIY) projects and invest new discretionary income in their dwellings. The overheated housing market also remains a tailwind in HD’s back.
In the meantime, MSFT became the property of cloud-based services. The rise of remote work has accelerated companies’ adoption of Microsoft products like Azure and Office 365. Looking ahead, analysts say enterprise customers are still in the early stages of their digital transformations.
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On the other side of the ledger, analysts say some of this year’s losers are set to become winners in 2022. Look no further than Walt Disney (DIS, $155.93) for example.
Disney was the Dow’s worst stock in 2021, losing nearly 14%. The media and entertainment conglomerate has been undone primarily by the emergence of the delta and omicron variants of COVID-19. Anything that creates uncertainty about the health of Disney’s major parks and resorts — not to mention the comic-entertainment business — is bad for DIS shareholders.
As much as 2021 has been a problem for the DIS, Street is giving stocks a consensus recommendation to buy, with fairly high conviction to take off. Thinking says the pandemic cannot go on forever, and stocks look cheap.
This is hope, anyway.
Without further ado, take a look at how all 30 Dow Jones stocks will perform in 2021 in the table below: