The Dow Jones (^DJI) is home to corporate giants, but size alone doesn’t guarantee success. A few of these companies are struggling with weak fundamentals, paradigm shifts, or poor execution.

Not all Dow Jones stocks are worth owning - which is why we built StockStory to help you invest wisely. That said, here are two Dow Jones stocks positioned for long-term growth and one best left off your watchlist.

One Stock to Sell:

IBM (IBM)

Market Cap: $261.5 billion

With a corporate history spanning over a century and once known for its iconic mainframe computers, IBM (NYSE: IBM) provides hybrid cloud computing platforms, AI solutions, consulting services, and enterprise infrastructure to help businesses modernize their operations.

Why Are We Cautious About IBM?

1. Sales were flat over the last five years, indicating it’s failed to expand this cycle
2. Earnings per share lagged its peers over the last five years as they only grew by 3.3% annually
3. ROIC of 11.5% reflects management’s challenges in identifying attractive investment opportunities

At $276.15 per share, IBM trades at 24x forward P/E. Read our free research report to see why you should think twice about including IBM in your portfolio.

Two Stocks to Buy:

Merck (MRK)

Market Cap: $210.1 billion

With roots dating back to 1891 and a portfolio that includes the blockbuster cancer immunotherapy Keytruda, Merck (NYSE: MRK) develops and sells prescription medicines, vaccines, and animal health products across oncology, infectious diseases, cardiovascular, and other therapeutic areas.

Why Should You Buy MRK?

1. Unparalleled scale of $63.62 billion in revenue gives it negotiating leverage and staying power in an industry with high barriers to entry
2. Adjusted operating margin expanded by 18.6 percentage points over the last two years as it scaled and became more efficient
3. Free cash flow margin grew by 10.7 percentage points over the last five years, giving the company more chips to play with

Merck is trading at $84.02 per share, or 9.3x forward P/E. Is now the time to initiate a position? Find out in our full research report, it’s free for active Edge members.

Visa (V)

Market Cap: $666 billion

Processing over 829 million transactions daily and connecting billions of cards to 150 million merchant locations worldwide, Visa (NYSE: V) operates one of the world's largest electronic payments networks, facilitating secure money movement across more than 200 countries through its VisaNet processing platform.

Why Are We Backing V?

1. Solid 11.2% annual revenue growth over the last five years indicates its offering’s solve complex business issues
2. Share buybacks propelled its annual earnings per share growth to 16.8%, which outperformed its revenue gains over the last five years
3. Market-beating return on equity illustrates that management has a knack for investing in profitable ventures

Visa’s stock price of $336.82 implies a valuation ratio of 27.8x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free for active Edge members.

High-Quality Stocks for All Market Conditions

Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.

Take advantage of the rebound by checking out our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Exlservice (+354% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today

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