To some, Dow 20,000 is a cause for celebration. To others, it’s just a fascination. For shrewd investors, it’s an opportune time to consider how expensive stocks are.
This chart shows that the price-to-earnings ratio for the Dow Jones Industrial Average DJIA, +0.14% has never been higher (going back 15 years), while the S&P 500 Index SPX, +0.03% was considerably higher in 2002:
FactSet
So we thought it would be helpful to see which of the 30 Dow stocks are cheapest, according to consensus 2018 earnings estimates. After that, we’ll review which stocks have posted the fastest growth in sales per share and the ones most beloved by Wall Street analysts.
Here are the 10 Dow Jones Industrial Average stocks trading lowest to consensus 2018 earnings estimates:
| Company | Ticker | Closing price - Jan. 24 | Consensus 2018 EPS estimate | Price/consensus 2018 EPS estimate |
| Goldman Sachs Group Inc. | GS,-0.24% | $233.68 | $21.67 | 10.8 |
| Pfizer Inc. | PFE,+0.83% | $31.15 | $2.82 | 11.0 |
| J.P. Morgan Chase & Co. | JPM,-0.12% | $84.72 | $7.46 | 11.4 |
| Travelers Cos. | TRV,-1.05% | $116.84 | $9.97 | 11.7 |
| Apple Inc. | AAPL,+0.11% | $119.97 | $10.10 | 11.9 |
| Cisco Systems Inc. | CSCO,-0.72% | $30.60 | $2.49 | 12.3 |
| American Express Co. | AXP,+0.50% | $77.43 | $6.29 | 12.3 |
| International Business Machines Corp. | IBM,-0.13% | $175.90 | $14.17 | 12.4 |
| Verizon Communications Inc. | VZ,-1.27% | $50.12 | $3.99 | 12.5 |
| Intel Corp. | INTC,-0.27% | $37.62 | $2.93 | 12.9 |
| Source: FactSet | ||||
For comparison, the entire Dow Jones Industrial Average trades for 15 times consensus 2018 earnings-per-share estimates.
Here are the 10 Dow companies with the fastest growth of sales per share over the past 12 reported months:
| Company | Ticker | Sales per share - past 12 reported months through Jan. 24 | Sales per share - previous 12-month period | Growth of sales per share |
| UnitedHealth Group Inc. | UNH,+0.38% | $190.93 | $162.44 | 18% |
| Pfizer Inc. | PFE,+0.83% | $8.64 | $7.62 | 13% |
| Home Depot Inc. | HD,-0.10% | $75.03 | $66.98 | 12% |
| Walt Disney Co. | DIS,+0.59% | $33.76 | $30.43 | 11% |
| Travelers Cos. | TRV,-1.05% | $94.90 | $85.53 | 11% |
| Visa Inc. Class A | V,-0.33% | $6.24 | $5.65 | 10% |
| Nike Inc. Class B | NKE,+0.23% | $19.51 | $17.88 | 9% |
| Goldman Sachs Group Inc. | GS,-0.24% | $84.94 | $78.27 | 9% |
| McDonald’s Corp. | MCD,-0.12% | $28.63 | $26.93 | 6% |
| Intel Corp. | INTC,-0.27% | $11.89 | $11.24 | 6% |
| Source: FactSet | ||||
We looked at sales per share, rather than revenue, as the per-share figures reflect any decline in share counts from stock repurchases, as well as dilution by the net issuance of shares.
Here are price-to-earnings ratios, based on consensus 2018 EPS estimates:
| Company | Ticker | Closing price - Jan. 24 | Consensus 2018 EPS estimate | Price/consensus 2018 EPS estimate |
| UnitedHealth Group Inc. | UNH,+0.38% | $160.43 | $10.66 | 15.1 |
| Pfizer Inc. | PFE,+0.83% | $31.15 | $2.82 | 11.0 |
| Home Depot Inc. | HD,-0.10% | $138.06 | $8.07 | 17.1 |
| Walt Disney Co. | DIS,+0.59% | $107.90 | $6.66 | 16.2 |
| Travelers Cos. | TRV,-1.05% | $116.84 | $9.97 | 11.7 |
| Visa Inc. Class A | V,-0.33% | $83.23 | $3.84 | 21.7 |
| Nike Inc. Class B | NKE,+0.23% | $53.45 | $3.04 | 17.6 |
| Goldman Sachs Group Inc. | GS,-0.24% | $233.68 | $21.67 | 10.8 |
| McDonald’s Corp. | MCD,-0.12% | $121.05 | $6.61 | 18.3 |
| Intel Corp. | INTC,-0.27% | $37.62 | $2.93 | 12.9 |
| Source: FactSet | ||||
Here are the 10 Dow companies with majority “buy” ratings that analysts expect to show the most price appreciation over the next 12 months:
| Company | Ticker | Share ‘buy’ ratings | Share neutral ratings | Share ‘sell’ ratings | Closing price - Jan. 24 | Consensus price target | Implied 12-month upside potential |
| Pfizer Inc. | PFE,+0.83% | 52% | 48% | 0% | $31.15 | $37.70 | 21% |
| Nike Inc. Class B | NKE,+0.23% | 61% | 33% | 6% | $53.45 | $61.56 | 15% |
| Visa Inc. Class A | V,-0.33% | 84% | 16% | 0% | $83.23 | $95.13 | 14% |
| UnitedHealth Group Inc. | UNH,+0.38% | 92% | 8% | 0% | $160.43 | $181.86 | 13% |
| General Electric Co. | GE,-0.03% | 63% | 32% | 5% | $30.00 | $33.69 | 12% |
| Merck & Co. | MRK,-0.08% | 54% | 41% | 5% | $61.21 | $68.36 | 12% |
| Apple Inc. | AAPL,+0.11% | 80% | 18% | 2% | $119.97 | $133.34 | 11% |
| Chevron Corp. | CVX,-0.02% | 64% | 36% | 0% | $116.37 | $125.88 | 8% |
| Home Depot Inc. | HD,-0.10% | 74% | 26% | 0% | $138.06 | $147.85 | 7% |
| Intel Corp. | INTC,-0.27% | 64% | 28% | 8% | $37.62 | $40.09 | 7% |
| Source: FactSet | |||||||
Here are their P/E ratios, based on consensus 2018 EPS estimates:
| Company | Ticker | Closing price - Jan. 24 | Consensus 2018 EPS estimate | Price/consensus 2018 EPS estimate |
| Pfizer Inc. | PFE,+0.83% | $31.15 | $2.82 | 11.0 |
| Nike Inc. Class B | NKE,+0.23% | $53.45 | $3.04 | 17.6 |
| Visa Inc. Class A | V,-0.33% | $83.23 | $3.84 | 21.7 |
| UnitedHealth Group Inc. | UNH,+0.38% | $160.43 | $10.66 | 15.1 |
| General Electric Co. | GE,-0.03% | $30.00 | $1.91 | 15.7 |
| Merck & Co. | MRK,-0.08% | $61.21 | $4.20 | 14.6 |
| Apple Inc. | AAPL,+0.11% | $119.97 | $10.10 | 11.9 |
| Chevron Corp. | CVX,-0.02% | $116.37 | $6.65 | 17.5 |
| Home Depot Inc. | HD,-0.10% | $138.06 | $8.07 | 17.1 |
| Intel Corp. | INTC,-0.27% | $37.62 | $2.93 | 12.9 |
| Source: FactSet | ||||
As you can see, most of the stocks analysts predict will post the biggest gains don’t trade at cheap P/E ratios.
Here’s how this group of beloved Dow stocks has grown its sales per share over the past 12 months:
| Company | Ticker | Sales per share - past 12 reported months through Jan. 24 | Sales per share - previous 12-month period | Growth of sales per share |
| Pfizer Inc. | PFE,+0.83% | $8.64 | $7.62 | 13% |
| Nike Inc. Class B | NKE,+0.23% | $19.51 | $17.88 | 9% |
| Visa Inc. Class A | V,-0.33% | $6.24 | $5.65 | 10% |
| UnitedHealth Group Inc. | UNH,+0.38% | $190.93 | $162.44 | 18% |
| General Electric Co. | GE,-0.03% | $13.15 | $12.81 | 3% |
| Merck & Co. | MRK,-0.08% | $14.18 | $13.73 | 3% |
| Apple Inc. | AAPL,+0.11% | $38.86 | $39.86 | -3% |
| Chevron Corp. | CVX,-0.02% | $57.74 | $76.44 | -24% |
| Home Depot Inc. | HD,-0.10% | $75.03 | $66.98 | 12% |
| Intel Corp. | INTC,-0.27% | $11.89 | $11.24 | 6% |
| Source: FactSet | ||||
Source: http://www.marketwatch.com/story/the-10-cheapest-fastest-growing-and-most-beloved-dow-stocks-2017-01-25
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