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Dow on Longest Losing Streak in 8 Yrs: 5 Stocks Still Up in ETF

Sweta Killa
Salesforce.com agreed to buy big data firm Tableau Software for $15.3 billion in an all-stock deal. This has put the spotlight on ETFs having large exposure to Salesforce.

The Wall Street has been on a tumultuous ride over the past several weeks as intensifying trade dispute between the United States and China raised concerns about global economic growth. Notably, the Dow Jones fell for a fifth straight week – representing the longest losing streak since June 2011 (read: Tense About Trade War? Follow Goldman With 5 ETF Strategies).

Amid the escalating feud, President Donald Trump increased tariff to 25% from 10% on Chinese goods worth of $200 billion effective May 10 midnight, and has threatened to levy another 25% tariff on another $325 billion of Chinese goods. In retaliation, China is seeking to impose as much as 25% tariff on U.S. imports worth $60 billion, effective Jun 1. Additionally, Trump has banned Chinese firm Huawei Technologies and 26 of its affiliates from doing business with American companies though it provided a 90-day exemption.

Further, lower crude prices also took toll on the stocks last week (read: Oil Likely to See Steepest Weekly Fall: Inverse ETFs to Profit).  

Given this, SPDR Dow Jones Industrial Average ETF DIA tracking the Dow Jones has lost 3.2% over the past month. Let’s take a closer look at the fundamentals of DIA and its performance.

DIA in Focus

With AUM of $21 billion, DIA holds 30 stocks in its basket with each security holding no more than 9.4% share. The fund is widely spread across sectors with industrials, information technology and financials being the top three. It charges 17 basis points in fees per year from investors and trades in heavy volume of around 4.3 million shares a day on average.

The fund has a Zacks ETF Rank #1 (Strong Buy) with a Medium risk outlook. Though most of the stocks in the fund’s portfolio pushed the ETF down, a few are still in green. Below, we have highlighted those five best-performing stocks in the ETF with their respective positions in the fund’s basket:

Top Performing Stocks of DIA

Merck & Co. Inc. MRK: The stock has jumped nearly 6% in a month and accounts for 2.1% share in DIA. It carries a Zacks Rank #2 (Buy) and has a VGM Score of C. The company has seen earnings estimate revision of 7 cents for this year over the past month and has an expected earnings growth rate of 8.76%. The stock falls under a top-ranked Zacks industry (top 23%). You can see the complete list of today’s Zacks #1 Rank stocks here.

Pfizer Inc. PFE: The stock has gained about 6% over the past month. It has seen positive earnings estimate revision of a couple of cents in a week for this year. It has an expected growth rate of 3.94%. Pfizer currently has a Zacks Rank #3 (Hold) and VGM Score of C. The stock belongs to a top-ranked Zacks industry (top 23%) and makes up for 1.1% exposure.

The Travelers Companies, Inc. TRV: This stock holds the ninth spot in the fund’s basket with 3.9% allocation and has gained 5.5% in a month. The stock has seen negative earnings estimate revision activity by 5 cents for this year over the past month but has an estimated year-over-year earnings growth of 24.3%. TRV belongs to a top-ranked Zacks industry (top 17%). It has a Zacks Rank #3 (Hold) and VGM Score of B (read: Markets Jump as Fears Ease: 4 Sector ETFs at New Highs).

UnitedHealth Group Incorporated UNH: This stock takes the second spot and accounts for 6.5% of assets in the fund’s basket. It has gained 4.5% and witnessed positive earnings estimate by a penny for this year in a month. Its earnings are expected to increase 14.2% year over year. UnitedHealth has a Zacks Rank #3 and a VGM Score of A. It belongs to a top-ranked Zacks industry (top 7%) (read: UnitedHealth Falls Despite Q1 Beat, Healthcare ETFs in Focus).

Verizon Communications Inc. VZ: The stock has risen 4.8% in a month. It has 1.6% exposure in the fund’s basket and has seen positive earnings estimate revision of a penny for this year in a month. Verizon has an expected earnings growth of 0.9% for this year. The company has a Zacks Rank #3 and a VGM Score of B. It belongs to a top-ranked Zacks industry (top 25%).

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Merck & Co., Inc. (MRK) : Free Stock Analysis Report
 
Pfizer Inc. (PFE) : Free Stock Analysis Report
 
Verizon Communications Inc. (VZ) : Free Stock Analysis Report
 
SPDR Dow Jones Industrial Average ETF (DIA): ETF Research Reports
 
The Travelers Companies, Inc. (TRV) : Free Stock Analysis Report
 
UnitedHealth Group Incorporated (UNH) : Free Stock Analysis Report
 
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