While the Dow Jones (^DJI) represents industry leaders, not every stock in the index is a safe bet. Some are facing headwinds like declining demand, rising costs, or disruptive new competitors.
Not all Dow Jones stocks are worth owning - which is why we built StockStory to help you invest wisely. That said, here are three Dow Jones stocks to steer clear of and a few alternatives to consider.
Procter & Gamble (PG)
Market Cap: $358.4 billion
Founded by candle maker William Procter and soap maker James Gamble, Proctor & Gamble (NYSE: PG) is a consumer products behemoth whose product portfolio spans everything from facial tissues to laundry detergent to feminine care to men’s grooming.
Why Is PG Not Exciting?
- Flat unit sales over the past two years show it’s struggled to move its products and had to rely on price increases
- Estimated sales growth of 2.9% for the next 12 months is soft and implies weaker demand
- 3 percentage point decline in its free cash flow margin over the last year reflects the company’s increased investments to defend its market position
At $152.26 per share, Procter & Gamble trades at 21.8x forward P/E. Check out our free in-depth research report to learn more about why PG doesn’t pass our bar.
Boeing (BA)
Market Cap: $170.8 billion
One of the companies that forms a duopoly in the commercial aircraft market, Boeing (NYSE: BA) develops, manufactures, and services commercial airplanes, defense products, and space systems.
Why Do We Pass on BA?
- Flat unit sales over the past two years show it’s struggled to increase its sales volumes and had to rely on price increases
- Cash-burning tendencies make us wonder if it can sustainably generate shareholder value
- Short cash runway increases the probability of a capital raise that dilutes existing shareholders
Boeing’s stock price of $225.01 implies a valuation ratio of 165x forward P/E. Dive into our free research report to see why there are better opportunities than BA.
IBM (IBM)
Market Cap: $242.4 billion
With a corporate history spanning over a century and once known for its iconic mainframe computers, IBM (NYSE: IBM) provides hybrid cloud computing platforms, AI solutions, consulting services, and enterprise infrastructure to help businesses modernize their operations.
Why Does IBM Fall Short?
- Flat sales over the last five years suggest it must find different ways to grow during this cycle
- Earnings growth over the last five years fell short of the peer group average as its EPS only increased by 3.3% annually
- Below-average returns on capital indicate management struggled to find compelling investment opportunities
IBM is trading at $259.60 per share, or 23x forward P/E. Read our free research report to see why you should think twice about including IBM in your portfolio.
Stocks We Like More
When Trump unveiled his aggressive tariff plan in April 2024, markets tanked as investors feared a full-blown trade war. But those who panicked and sold missed the subsequent rebound that’s already erased most losses.
Don’t let fear keep you from great opportunities and take a look at Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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