BOSTON (TheStreet) -- Large-cap companies are selling at bargain-bin prices despite strong stock gains in the past two months. Investors considering increasing equity holdings should consider Dow stocks first and foremost. Not only do they offer some of the highest dividend yields in the U.S., but they also trade at discounts to respective industry averages.
XOM), the larger oil-and-gas Dow component, receives just nine "buy" ratings, 12 "hold" calls and one recommendation to "sell." Chevron's median 12-month price target of $94.73 suggests that the stock will return 15%, excluding dividends. The stock pays a quarterly distribution of 72 cents, equal to a yield of 3.5% and a safe payout ratio of 33%. Chevron sports a three-year dividend growth rate of 8.4% and a five-year growth rate near 11%. Barclays ( BCS), ranked as the best equity researcher for seven consecutive years by Institutional Investor, is bullish. It has a $110 price target on the stock, the highest on the Street, predicting an advance of 34%. Valuation is compelling. Chevron trades at a trailing earnings multiple of 9.8, a forward earnings multiple of 8.4, a book value multiple of 1.6 and a sales multiple of 0.9 -- 39%, 44%, 65% and 54% discounts to oil-and-gas industry averages.