Every year, one of the best strategies is to follow the Dogs of the Dow.
You simply buy a basket of underperforming Dow stocks that pay dividends and sell them by the end of the year.
Verizon (SYM: VZ)
With a yield of 6.3%, oversold shares of Verizon (SYM: VZ) are just starting to pivot higher.
After dropping from about $45.50 to $41.34, it’s just starting to push higher again. Last trading at $43.11, we’d like to see VZ initially retest its prior high.
Earnings weren’t too shabby.
In its first quarter, the company’s adjusted EPS of $1.19 beat expectations of $1.15. Total operating revenue jumped to $33.5 billion, which was slightly above analyst expectations for $33.3 billion. This growth was driven by wireless service revenue (which grew by 2.7% in the quarter) and broadband expansion.
Merck (SYM: MRK)
With a yield of 3.94%, Merck (SYM: MRK) hasn’t been this cheap since the middle of 2022.
But that’ll happen with disappointing guidance for 2025, a decline in sales of its Gardasil vaccine, concerns over the future of its blockbuster drug Keytruda, and tariffs.
However, with a good chunk of negativity now priced into Merck, it’s starting to show big signs of life again. Last trading at $82.14, we’d like to see it retest $95.
IBM (SYM: IBM)
Oversold, but pivoting higher, IBM (SYM: IBM) is just as attractive – especially with its 2.41% yield. Plus, the tech giant also just saw its first insider buy for the year. On February 28, director David Farr paid $300,000 for 1,200 shares of IBM.
Even more exciting, IBM just announced plans to invest $150 billion in tech manufacturing, research, and development in the U.S. The company added that the investment will help accelerate U.S. production of quantum computers while boosting the economy.
Related Reading: Drop these 5 stocks now!
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