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5 Dow Stocks Likely to Rise After Earnings

BOSTON ( TheStreet) -- Some Dow stocks, such as JPMorgan Chase (JPM - Get Report) and IBM (IBM - Get Report), tend to perform better than others after reporting second-quarter earnings results.

That's not the case with Disney (DIS) and Microsoft (MSFT).

Alcoa (AA) unofficially kicks off the earnings reporting season July 11 after the stock market's closing bell. The aluminum producer's stock doesn't fare well after reporting second-quarter numbers, falling an average of 0.7% the following day, according to data collected over the past 10 years.

Disney, Microsoft and Exxon Mobil (XOM) typically fall an average of 2% in the trading session after the companies report financial results for the second quarter.

Earnings season can involve risks because of additional volatility for many of the 30 Dow components, especially this year, when the Dow has seesawed. The benchmark is up almost 9% this year. Last summer, shares of Bank of America (BAC) and Cisco Systems (CSCO) each plunged 10% during the trading day after reporting their respective results, while Pfizer (PFE) shares rallied nearly 6%.

Nothing is a sure bet, but history can be a guide. The following five Dow stocks have notched, on average, the biggest gains in the trading day immediately after posting quarterly numbers in July and August over the past 10 years. TheStreet has ranked the top five winners based on that percentage rise.

5. United Technologies (UTX - Get Report)

Company Profile: Industrial giant United Technologies is the maker of Pratt & Whitney jet engines and Otis elevators.

Expected Reporting Date: July 18 (before market open)

Historical Price Performance: Shares of United Technologies have increased an average of 1.1% in the trading session immediately after the company posts second-quarter results. In six of the past 10 years, shares have climbed during that trading session. Among the biggest increases, United Technologies shares rose 5.9% on July 17, 2008, after the company beat earnings expectations.

Analyst Consensus: Analysts predict that United Technologies will report a second-quarter profit of $1.41 a share and revenue of $14.7 billion, according to data compiled by Thomson Reuters. That compares to year-earlier earnings of $1.20 a share and revenue of $13.9 billion.

United Technologies is a favorite among analysts headed into second-quarter earnings, garnering 20 "buy" ratings and five "hold" ratings, according to data compiled by Bloomberg. No analyst following the company recommends selling shares. The average price target of $98.25 represents potential upside of 8.7% from current levels.

Share Price Return in 2011: +14.5%
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JPM $67.02 -0.22%
IBM $139.47 0.73%
T $33.67 0.30%
UTX $96.24 -0.58%
AAPL $118.63 0.70%


Chart of I:DJI
DOW 17,756.97 -41.52 -0.23%
S&P 500 2,085.41 -4.70 -0.22%
NASDAQ 5,104.4380 -23.0870 -0.45%

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