The Dow Jones Index jumped to a record high last week, helped by strong performance of some traditional companies. It jumped to a high of 52,905, up by 17% from it lowest level this year. This article highlights some of the top companies that drove the index to an all-time high.
Caterpillar is the best-performing Dow Jones Index stock this year
Caterpillar, the giant manufacturer of industrial machinery, has been the best-performing company in the Dow Jones Index and the DIA ETF.
Its stock has soared by 66% this year and 145% in the last 12 months, helped by the rising demand for power equipment that power data centers.
The most recent results showed that its power revenue jumped by 22% in Q1 to $7 billion. Its construction equipment business surged by 38% to $7.2 billion, while the resource segment rose by 4%.
A key concern about Caterpillar is whether this growth will continue in the coming months as signs of a slowdown in the data center industry emerge. For example, Americans have started to revolt against data centers ahead of the mid-term elections.
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Cisco Systems jumps on networking demand
Cisco Systems, a company that briefly became the biggest company in the world during the dot com bubble, is now the second best-performer in the Dow Jones Index. Its stock has jumped by 47% this year and 60% in the last 12 months.
The rise is mostly because it has become a big player in the data center space, where its networking equipment has become essential. Its recent numbers showed that its revenue jumped by 12% in Q1 to $15.8 billion. Its AI infrastructure revenue rose to $5.3 billion, with the company recording several multi-year contracts.
UnitedHealth Group
UnitedHealth Group, the biggest health insurance company in the US, is the third best performer in the Dow Jones despite Berkshire Hathaway selling its stake. UNH stockhas jumped by 28% this year and by 32% in the last 12 months.
The surge coincides with the strong recovery of top health insurance companies like CVS and Humana. It is mostly because the Trump administration decided to hike Medicare Advantage rates for the year by over 2%, higher than the expected 0.5%.
Investors have also cheered the company’s turnaround efforts under the new management. It is leveraging AI to cut costs and boosting its shareholder returns.
Coca-Cola Company
Coca-Cola, the giant beverage company, has done well this year, rising by 20%. This rise is because of its modest growth and the fact that its business thrives across all cycles. Its revenue rose by 12% in the first quarter, with the earnings per share rising by 18%. Analysts are bullish about the company as operational costs fall.
The other top gainers in the Dow Jones are companies like The Travelers, Goldman Sachs, Amgen, Alphabet, and Apple.
On the other hand, popular names in the index have also become the top laggards this year. Salesforce stock is down 37% amid the ongoing SaaSpocalypse fears. There are also concerns about its growth through acquisitions approach.
Nike stock has dropped by 31%, while Microsoft, Disney, McDonald’s, and American Express are the top losers this year. Microsoft has dropped because of its substantial capital spending, while Nike’s turnaround efforts are taking longer than expected.
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