Dow 30 Overview As March 20,2021

In my early posts I wrote about Dow 30 industrial average index and how it seems to me as overvalued compared to fair value of those stocks that included in it. Here I will list all the stocks inside the Dow 30 index and their fair values and the prices they are trading with in market. Based on the fair values of these stocks, a conclusion about if the Dow 30 is overvalued or undervalued or stable and has fair value can be made.

Company NameTicker Price of Stock Fair value of Stock
Apple IncAAPL119.9957.54
AMERICAN EXPRESS COAXP140.7111.9
BOEING COBA255.82-25.5
CATERPILLAR INCCAT225.2915.15
CISCO SYSTEMS INCCSCO48.9840.73
CHEVRON CORPORATIONCVX103.3826.33
WALT DISNEY COMPANYDIS191.1434.35
DOW INCDOW63.91114.74
GOLDMAN SACHS GROUP INCGS344.2-845
HOME DEPOT INCHD289.1313.26
INTERNATIONAL BUS MACH CORPIBM128.9375.03
INTEL CORPINTC63.766146
JOHNSON & JOHNSONJNJ160.04204.6
JPMD JPMORGAN CHASE & COJPM155.14-864
COCA-COLA COKO50.8170.6
MCDONALD’S CORPORATIONMCD222.44265.67
3M COMPANY3M188.71255.53
MERCK & CO INCMRK77.51162.31
MICROSOFT CORP.MSFT230.35141.09
NIKE INCNKE137.4923.17
PFIZER INCPFE35.5367.55
PROCTER & GAMBLE COPG128.01327.14
RAYTHEON TECHNOLOGIES CORPORATIONRTX78.3619.62
TRAVELERS COMPANIES INCTRV149.3725.6
UNITEDHEALTH GROUP INCUNH365.58576.15
VISA INCV206.982.67
VERIZON COMMUNICATIONSVZ56.24413.81
WALGREENS BOOTS ALLIANCE INCWBA52.54450
WALMART INCWMT131.74716.45
EXXON MOBIL CORPORATIONXOM56.490.25
Stocks Prices Compared to their fair values as of March 20, 2021

The above table listed all the 30 companies that are listed in Dow 30 with their prices and their fair values. There is some notes that should be clarified to make the above table reliable.

Notes:

  1. The above table is not a recommendation for any stock in any trade, if you want to buy or short any stock do your due diligence and make sure that your investing or trading systems align with the information listed above.
  2. The assumption used to estimated the fair values of all the stocks above is as if theses companies growths’ are similar to the USA GDP growth which is 2.2%.
  3. Some of the above fair values is in minus (-) which does not make sense, but it can provide a clue about how these stocks are completely overvalued.
  4. Number of overvalued companies are (14) which is have the companies in the Dow 30 index, that might be the reason why the DOW 30 still in uptrend or sideway, and traders should exercise caution if they want to short stocks in uptrend with high momentum.
  5. Traders can use their systems to look for short term deals that presented for them by market movement, investors on the other hand need to stick to stock fair value instead of its price, because even if there will be bear move the market at the end will appreciate the stock fair value and move toward it.

Stock fair value is something completely different than its price which is listed in the market that affected by the law of supply and demand. The wise investors need to distinguished between these two things and never buy stock that its price higher than its fair value and, never sell stock that its price is lower than its fair value.

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