Dow Disasters: The 4 Stocks That Sank and What It Means for You

Stocks

Stock	Price	52 Week Range	Marketcap	EPS	Dividend Yield	Chart (24H)	Sector	Employees	Last Updated
Bank of America Corporation BAC	$44.09		332.08B	3.35	2.36%		Financial Services	213,000	2 days ago
Pfizer, Inc. PFE	$24.54		139.52B	1.38	7.01%		Healthcare	88,000	2 days ago
Procter & Gamble Company (The) PG	$160.28		375.78B	6.30	2.64%		Consumer Defensive	108,000	2 days ago
Coca-Cola Company (The) KO	$71.02		305.69B	2.49	2.87%		Consumer Defensive	79,100	2 days ago

Investors, brace yourselves. The stock market is a wild beast, unpredictable and relentless. Last week brought with it a prime example of this unpredictability, as various **Dow Jones Industrial Average (DJIA)** components took significant hits. Despite being blue-chip behemoths, these companies faced a confluence of adverse factors that dented their stock prices, reflecting broader market volatility and underlying economic challenges.

The Dow Jones Industrial Average witnessed a decline of 1.22% last week, equating to a loss of 187 points. This drop mirrors a larger market uncertainty, driven by rising interest rates and geopolitical issues. Investors are increasingly moving their capital to “safer” government bonds, abandoning stocks that now seem to carry more risk than reward. Particularly affected sectors included healthcare, consumer goods, and technology, each grappling with its own set of unique challenges.

Although the past week was shorter due to the long holiday weekend, it was nonetheless filled with market drama and excitement. The DJIA opened sharply higher on Tuesday, closing up 106 points for the day. However, it closed lower by 106 points on Wednesday. Thursday saw a brief upward trend until a late afternoon decline of 73 points, and Friday witnessed a two-hour fall culminating in a 208-point drop. This volatile trading resulted in an overall 1.22% decline for the week.

Editor's Note: Analysis and insight for this article were originally sourced sourced from our friends at The Motley Fool 

Bank of America Corporation

BAC

$44.09

1%

While most Dow components floundered, **Bank of America** managed to rise by 3.17%. This financial giant continues to deal with the lingering effects of its Countrywide acquisition. One silver lining, however, is the rising interest rates. Now that rates are climbing higher, the spread between the bank’s borrowing and lending rates is widening, promising enhanced profitability on fundamental banking transactions. For contrarian investors, **BAC’s** performance exemplifies how strategic sector positioning can counterbalance broader market downtrends.

Analyst Ratings for BAC

Summary of Analyst Outlook for BAC

Analysts are generally optimistic about **Bank of America (BAC)**. The average price targets range from $41.11 to $42.69. The consensus is that the stock has moderate potential for growth, with most analysts suggesting it as a strong investment option.

Pfizer, Inc.

PFE

$24.54

1%

In stark contrast, **Pfizer** plummeted by 6.23%. The healthcare sector had a rough week, but Pfizer was particularly hit hard due to a trifecta of problems: general sector volatility, a conservative 12-month price target from SunTrust, and rising interest rates. These rising rates drew investors away from high-yield stocks towards more stable bonds, with Pfizer’s 3.3% dividend suddenly seeming less attractive. This shift underscores the sensitivity of pharmaceutical stocks to interest rate movements and market sentiment.

Analyst Ratings for PFE

Summary of Analyst Outlook for PFE

The analysts’ consensus is generally optimistic about **Pfizer’s** future performance, with significant potential for growth. The average price targets vary between $33.83 and $41.96, indicating a high likelihood of price increases.

Procter & Gamble Company (The)

PG

$160.28

2%

The biggest loser of the week was **Procter & Gamble**, which fell by 6.25%. Initial excitement had surged when former CEO A.G. Laffley returned, sparking investor enthusiasm. However, this sentiment reversed as profit-taking ensued. Investors grew wary of potential managerial changes and the costs of internal restructuring. Despite **PG’s** historical stability, these recent events catalyzed significant stock movement, illustrating the volatility even large-cap staples can experience.

Analyst Ratings for PG

Summary of Analyst Outlook for PG

Analysts’ opinions about **Procter & Gamble (PG)** vary slightly across different sources. Most sources agree that the stock has strong to moderate buy recommendations due to its stable performance in recent quarters.

Coca-Cola Company (The)

KO

$71.02

1%

**Coca-Cola** saw its shares decline by 5.32%, a drop triggered by multiple challenges. Slower GDP growth in China limits expansion prospects in one of the company’s most important markets. Domestically, the ongoing combat against obesity puts additional pressure on sales, while industrial action in Venezuela hampers operations. These diverse issues vividly demonstrate how global and local socio-economic factors can significantly impact multinational corporations.

Analyst Ratings for KO

Summary of Analyst Outlook for KO

Analysts are generally optimistic about **Coca-Cola’s (KO)** future performance, with a consensus strong buy rating and an average price target of $69.50, representing an upside potential of 9.11%.

Analyzing the Dow’s worst performers sheds light on sector-specific risks, the ripple effects of macroeconomic trends, and the importance of strategic investment decisions. The overarching theme of rising interest rates plays a pivotal role, driving a flight to safety in bonds at the expense of once-stable blue-chip stocks. For informed investors, these insights are invaluable in navigating the unpredictable waters of market volatility.

Stay sharp, stay informed, and most importantly, stay ahead of the game.