The Dow Jones (^DJI) is home to corporate giants, but size alone doesn’t guarantee success. A few of these companies are struggling with weak fundamentals, paradigm shifts, or poor execution.
Not all Dow Jones stocks are worth owning - which is why we built StockStory to help you invest wisely. Keeping that in mind, here is one Dow Jones stock positioned for long-term growth and two that may face some trouble.
Two Stocks to Sell:
Verizon (VZ)
Market Cap: $184.4 billion
Formed in 1984 as Bell Atlantic after the breakup of Bell System into seven companies, Verizon (NYSE: VZ) is a telecom giant providing a range of communications and internet services.
Why Do We Pass on VZ?
- Underwhelming customer growth over the past two years shows the company faced challenges in winning new contracts
- Projected sales growth of 2.2% for the next 12 months suggests sluggish demand
- Projected 1.8 percentage point decline in its free cash flow margin next year reflects the company’s plans to increase its investments to defend its market position
At $43.74 per share, Verizon trades at 9.2x forward P/E. To fully understand why you should be careful with VZ, check out our full research report (it’s free).
Goldman Sachs (GS)
Market Cap: $231.2 billion
Founded in 1869 as a small commercial paper business in New York City, Goldman Sachs (NYSE: GS) is a global financial institution that provides investment banking, securities, asset management, and consumer banking services to corporations, governments, and individuals.
Why Does GS Worry Us?
- Large revenue base makes it harder to increase sales quickly, and its annual revenue growth of 6.9% over the last five years was below our standards for the financials sector
Goldman Sachs is trading at $731.80 per share, or 15.3x forward P/E. Dive into our free research report to see why there are better opportunities than GS.
One Stock to Buy:
Microsoft (MSFT)
Market Cap: $3.76 trillion
Originally named "Micro-soft" for microcomputer software when founded in 1975, Microsoft (NASDAQ: MSFT) is a global technology company that develops software, cloud services, devices, and AI solutions for consumers, businesses, and organizations worldwide.
Why Are We Bullish on MSFT?
- Microsoft is one of the great brands not just in tech but all of business. It produces mission-critical software and bundles it together, resulting in cream-of-the-crop gross margins.
- The company's elite unit economics lead to robust profit margins that improve over time. This speaks to the scale advantages and operating efficiency across its diverse portfolio, which spans everything from Office and Azure to Minecraft.
- Microsoft has a virtuous cycle of returns. Its dominant market position enables it to generate strong free cash flow, and it reinvests these funds into promising ventures that further strengthen its competitive moat.
Microsoft’s stock price of $504.28 implies a valuation ratio of 33.9x forward price-to-earnings. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.
High-Quality Stocks for All Market Conditions
Donald Trump’s April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.
The smart money is already positioning for the next leg up. Don’t miss out on the recovery - check out our Top 5 Strong Momentum Stocks for this week. 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 Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today for free.
StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.
