The Dow Jones Industrial Average (DJIA) is a popular stock market index that tracks blue-chip companies that trade on the New York Stock Exchange (NYSE) and the Nasdaq. Over the past year, the index has posted solid gains of 18.7%, brushing aside high inflation, supply chain disruptions, and the fear of COVID-19 infections.
Furthermore, the index posted a solid start to this year. On Monday, in its first trading session of 2022, the Dow gained 246 points or 0.68% to close at a record 36,585. In addition, strategists expect the market rally to continue in 2022 due to an anticipated 8% increase in global corporate earnings and positive market sentiment.
Given this backdrop, Wall Street analysts expect a more than 30% price gain by Dow Jones stocks salesforce.com, inc. (CRM) and The Boeing Company (BA). Hence, we think these stocks might be ideal additions to one’s watchlist.
salesforce.com, inc. (CRM)
CRM operates as an enterprise cloud computing solutions developer focused on customer relationship management. The San Francisco company’s offerings include Sales Cloud, for storing data and monitoring leads and progress; and Service Cloud, which enables firms to deliver personalized customer services.
On Dec. 9, International Business Machines Corporation (IBM) and MuleSoft, Inc., a CRM company, announced a global partnership to extend its container service for multi-cloud and hybrid deployments and deliver increased integrations and solutions. The partnership is expected to benefit the company by facilitating customers’ move toward digitalization.
On Dec. 7, MuleSoft announced its new universal API management capabilities, which should transform MuleSoft’s end-to-end platform into a flexible and scalable solution. This might prove to be profitable for the company.
CRM’s total revenues increased 26.6% year-over-year to $6.86 billion in its fiscal third quarter, ended Oct. 31. Its gross profit improved 24.7% from the same period last year to $5.02 billion. Its non-GAAP income from operations climbed 26.6% from the prior-year quarter to $1.36 billion.
Analysts expect CRM’s EPS to improve 0.6% year-over-year to $4.71 in its fiscal year 2023. The Street expects its revenue to increase 20.4% from the prior year to $31.77 billion. Also, CRM has an impressive surprise earnings history; it has topped consensus EPS estimates in each of the trailing four quarters.
Over the past year, CRM’s stock has gained 14.8% in price to close yesterday’s trading session at $255.46. It has gained 2.9% over the past six months.
23 out of the 25 Wall Street analysts have rated CRM as Buy, while two have rated it Hold. The 12-month median price target of $340.43 indicates a 33.3% potential upside. The price targets range from a low of $308.00 to a high of $375.00.
The Boeing Company (BA)
Chicago-based BA designs, develops, manufactures, sells, and services commercial jetliners, military aircrafts, satellites, human space flight, and launch systems. The company operates through the four broad segments of Commercial Airplanes; Defense, Space & Security; Global Services; and Boeing Capital.
On Dec. 21, BA announced an order for 19 767 Freighters from UPS, which reflects BA’s 767 Freighters’ operational and payload capability. Also in December, Miami-based investment firm 777 Partners declared that it would purchase 30 additional jets. These purchase orders are expected to add to BA’s revenue stream significantly.
For its fiscal third quarter, ended Sept. 30, BA’s total revenues increased 8.1% year-over-year to $15.28 billion. This can be attributed to 10.1% rise in sales of products from the prior-year quarter to $12.55 billion. Its core operating earnings came in at $59 million, up substantially from its negative year-ago value.
The $4.76 consensus EPS estimate for the fiscal year 2022 indicates a 341.6% year-over-year increase. And the $86.82 billion consensus revenue estimate for the same period reflects a 33% improvement from the prior year.
The stock has gained 4.7% in price over the past month and 0.8% over the past five days to close yesterday’s trading session at $207.86.
Of the 15 Wall Street analysts rating BA, 13 have rated it Buy, while two have rated it Hold. The 12-month median price target of $272.46 indicates a 31.1% potential upside. The price targets range from a low of $220.00 to a high of $306.00.
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CRM shares fell $9.11 (-3.67%) in premarket trading Wednesday. Year-to-date, CRM has declined -5.56%, versus a 0.52% rise in the benchmark S&P 500 index during the same period.
About the Author: Anushka Dutta
Anushka is an analyst whose interest in understanding the impact of broader economic changes on financial markets motivated her to pursue a career in investment research. More...
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