The venerable Dow Jones Industrial Average appears to be getting left behind in the current bull market. Sure, the Dow is up over the last 12 months. However, its performance significantly lags the S&P 500 and the even higher-flying Nasdaq-100.
Some Dow Jones Industrial Average members aren't likely to be left behind, though. These three Dow stocks are set to soar in 2024 and beyond.
1. Amazon
Amazon(NASDAQ: AMZN) is one of three "Magnificent Seven" stocks in the Dow. Its performance over the last 12 months has been worthy of the "magnificent" label, with shares skyrocketing close to 70%.
Wall Street thinks Amazon can keep up its winning ways. The consensus 12-month price target for the stock reflects an upside potential of 11%. I share analysts' optimism about Amazon.
The company's cost-cutting efforts are paying off. Amazon's earnings jumped to $10.6 billion in the fourth quarter of 2023 from $0.3 billion in the prior-year period. I look for continued bottom-line momentum in the coming quarters.
More importantly, Amazon's long-term growth prospects remain strong. Advertising has become an important new growth driver. Amazon plans to launch its Project Kuiper satellites later this year to provide internet service from space. Artificial intelligence (AI) should provide a huge tailwind for Amazon Web Services' cloud platform.
2. Intel
Until recent weeks, Intel(NASDAQ: INTC) stood as one of the best-performing Dow stocks over the last 12 months. However, the giant chipmaker's massive losses in its foundry business revealed earlier this month dampened investors' enthusiasm.
Analysts still like Intel, though. The average 12-month price target for the stock is nearly 21% higher than the current share price. Although I'm unsure if Intel will hit that target over the next 12 months, I'm bullish about the stock overall.
For one thing, Intel expects its foundry business to be highly profitable by 2030. I believe the company's investment in manufacturing semiconductor chips for others is a smart long-term move.
I also like Intel's AI prospects. Its new Gaudi 3 AI chip could take some data center market share away from Nvidia. Edge AI -- pushing AI processing to where data is generated -- should present another big opportunity for Intel over the next several years.
3. Salesforce
Salesforce(NYSE: CRM) has done its part in lifting the Dow Jones. Shares of the software company are up 37% over the last 12 months. The stock had soared even higher but reports that Salesforce was in discussions to buy Informatica didn't make investors happy.
Any potential deal in the works has since fallen apart. Wall Street hasn't been rattled by the uncertainty, though. The consensus 12-month price target for Salesforce reflects an upside potential of roughly 14%.
Salesforce has been in a period of transformation -- a good one for the company. As CEO Marc Benioff said in the Q4 earnings call, "[P]roductivity is up, profitability is up, margin's up, revenue is up."
I expect Salesforce will continue to benefit from the explosion in adoption of AI. The company is seizing this opportunity, recently launching its Einstein 1 Studio. This new product enables Salesforce's users to customize the Einstein Copilot AI assistant.
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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Keith Speights has positions in Amazon. The Motley Fool has positions in and recommends Amazon, Nvidia, and Salesforce. The Motley Fool recommends Intel and recommends the following options: long January 2025 $45 calls on Intel and short May 2024 $47 calls on Intel. The Motley Fool has a disclosure policy.
