NEW YORK (
) -- Although the
Dow Jones Industrial Average
has crossed the 13,000 mark twice in February and risen more than 6% year to date, not all of the stocks in the index have seen gains.
Chase Investment Council quantitative analyst Brian Lazorishak said high-dividend stocks have been lagging this year. Adrian Day Asset Management President Adrian Day noted that each of the worst-performing stocks in the Dow have much higher yields than the top-performers.
Analysts believe that investors' risk appetites have increased this year as more signs of economic improvement have been coming.
Here are the worst performers in the Dow so far this year:
Johnson & Johnson
Shares of Verizon has fallen 4.96% year to date. This stock has "become a yield play," Lazorishak said, adding that the stocks with high dividends have been lagging this year.
The communications company announced earlier this month a streaming content
"While the exact business model is still unclear, we believe Verizon/Redbox are positioning themselves to be the preferred platform for content owners as video distribution increasingly moves online over time," Guggenheim analysts wrote in a Feb. 10 report.
Verizon's forward annual dividend yield is 5.2%.
Verizon shares reached a 52-week high on Jan. 3 of $40.48. The stock's 52-week low of $32.28 was set on Aug. 9.
The company's estimated price-to-earnings ratio for next year is 13.72; the average for fixed-line communications companies is 21.73. For comparison,
has a lower forward P/E of 11.96;
forward P/E is 15.72.
Twenty of the 37 analysts who cover Verizon rated it hold. Fifteen analysts gave the stock a buy rating and two rated it sell.
gives Verizon a B- grade with a buy rating and
price target. The stock closed Monday at $38.13.
Pfizer shares have fallen 1.76% year to date. Lazorishak noted that this pharmaceutical company is a safe play but its growth prospects "aren't tremendous."
The pharmaceutical company had a voluntary recall of its birth control pills Lo/Ovral-28 at the start of February. The pills may have been "out of sequence," the company said in a statement.
MEDAcorp survey suggests strong demand for a potent oral therapy, high awareness and willingness to prescribe PFE's oral twice daily JAK inhibitor, tofacitinib, as well as the impact of preferred reimbursement of tofacitinib over current biologics forecasted market share, particularly if FDA labeling allows for use after methotrexate and not at least one anti-TNF agent," Leerink Swann analysts wrote in a Feb. 15 report. "While we are making no changes to our forecast at this time, these results suggest to us that PFE's tofacitinib can achieve our $3B+ peak sales forecast in 2020. While tofacitinib should be an exciting new product launch for PFE in 2012 with the potential to exceed expectations, we expect FDA scrutiny to be high and await greater visibility on approval/labeling."
Pfizer's forward annual dividend yield is 4.2%.
Shares of Pfizer hit a 52-week high on Jan. 17 of $22.17. The stock's 52-week low of $57.50 was set on March 16.
Pfizer has a forward P/E of 9.02; the average for pharmaceutical companies is 20.51. For comparison, both
have higher forward P/Es of 10.21 and 10.61, respectively.
Twenty-one of the 27 analysts who cover Pfizer rated it buy. Four analysts gave the stock a hold rating and two rated it sell.
gives Pfizer an A- grade with a buy rating and
price target. The stock closed Monday at $21.26.
Johnson & Johnson
Johnson & Johnson shares are down 1.72% year to date. Lazorishak considered Johnson & Johnson another "safe play" that didn't have a lot of growth prospects.
The consumer goods and pharmaceutical company announced on Feb. 21 that Alex Gorsky will become CEO on April 26. Gorsky, the company's executive committee vice chairman, is replacing Bill Weldon, who is retiring.
"The move comes a touch earlier than we expected, but JNJ has typically made these announcements in conjunction with the annual shareholders' meeting, and Mr. Gorsky has been one of two well known internal leaders being groomed to potentially succeed Mr. Weldon for over a year," Bank of America Merrill Lynch analysts wrote in a Feb. 21 report. "The other internal candidate -- Sheri S. McCoy -- will continue on as Vice Chairman of the Executive Committee and will continue to lead JNJ's Pharma and Consumer Groups. From a stock picking perspective we view this move as more or less expected. The transition should be smooth and we would not expect any significant change in strategic direction for JNJ."
Johnson & Johnson's forward annual dividend yield is 3.5%.
Johnson & Johnson shares hit a 52-week high on July 7 of $68.05. The stock's 52-week low of $57.50 was set on March 16.
Johnson & Johnson has a forward P/E of 11.85; the average for pharmaceutical companies is 20.51. For comparison, both
have lower forward P/Es of 10.65 and 9.5 respectively.
Sixteen of the 29 analysts who cover Johnson & Johnson rated it buy; 13 analysts gave the stock a hold rating.
gives Johnson & Johnson a B grade with a buy rating and
price target. The stock closed Monday at $64.45.
Shares of Wal-Mart dropped 2.18% year to date. Wal-Mart's "disappointing" fourth-quarter earnings helped to put it on the worst-performing Dow list, Lazorishak said.
The world's biggest retailer reported fourth-quarter earnings last week of $5.2 billion, or $1.51 a share, up from year-ago earnings of $5 billion, or $1.41 a share. Sales at U.S. stores increased 1.5% but did not meet analysts' expectations of an increase of 1.8%.
"Traffic was positive and Jan. was the strongest month of Q4," Morgan Keegan analysts wrote in a Feb. 22 report. "Q4 was the second consecutive quarter of positivecomps and fourth consecutive quarter of comp improvement."
Wal-Mart's forward annual dividend yield is 2.5%.
Wal-Mart shares hit a 52-week high on Feb. 1 of $62.63. The stock's 52-week low of $48.31 was set on Aug. 10.
Wal-Mart has a forward P/E of 11.07; the average for broad-line retailers is 26.49. For comparison, both
have higher forward P/Es of 11.49 and 11.34 respectively.
Seventeen of the 34 analysts who cover Wal-Mart rated it hold. Sixteen analysts gave the stock a buy rating and one rated it sell.
gives Wal-Mart an A+ grade with a buy rating and
price target. The stock closed Monday at $58.46.
Coca-Cola shares have dropped 1.63% year to date. This stock is another defensive play, Lazorishak noted.
The soft drink company reported on Feb. 7 fourth-quarter earnings of $1.6 billion, or 72 cents a share, which fell from year-ago earnings of $5.8 billion, or $2.46 a share.
Of the company's recent presentation at the Consumer Analyst Group New York conference, Bank of America Merrill Lynch analysts wrote in a Feb. 22 report, "CFO Gary Fayard highlighted the company's marketing investments (over the last two years, KO has invested ~$11bn in direct marketing, or $17bn including bottling partners) and strategy for its Bottling investment group (expects to be a net seller of bottling assets over the next 3-5 years)."
Coca-Cola has a forward annual dividend yield of 3%.
Shares of Coca-Cola hit a 52-week high on Sept. 8 of $71.77. The stock's 52-week low of $61.29 was reached on March 16.
Coca-Cola has a forward P/E of 15.37; the average for soft drink companies is 29.69. Both
Dr. Pepper Snapple Group
have lower forward P/Es of 14.28 and 12.16, respectively.
Nineteen of the 23 analysts covering Coca-Cola rated it buy; four analysts gave the stock a hold rating.
gives Coca-Cola an A grade with a buy rating and
price target. The stock closed Monday at $68.83.
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-- Written by Alexandra Zendrian
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