Valuation Of The Dow Jones Industrial Average – July 2015 Update by Benjamin Clark, ModernGraham

As one of the features of Premium Membership, I take a look each month at the Dow Jones Industrial Average, listing out each individual component in an easy to read table, and calculate a value for the index that is based on the ModernGraham valuation model’s estimates for intrinsic values for each component.  This “Glance at the Dow” is also included in a regular post on the blog once each month, and will continue to be included in each month’s ModernGraham Stocks & Screens, which is released to premium subscribers every month.  I hope this is useful to all my subscribers, as another tool for evaluating Mr. Market’s current prices.

Readers may find a screen of some of the best components of the Dow by reviewing 5 Undervalued Dow Companies to Research, and may find it useful to review the history of this screen.

Dow Jones Industrial Average

^DJI data by YCharts

At the time of writing, the Dow Jones Industrial Average (DJIA) was at 17,919.29. The ModernGraham Valuation of the DJIA was 19,834.16. As a result, the DJIA was trading at 90.35% of its estimated value. This figure is within the ModernGraham margin of error, and therefore it appears the DJIA is presently fairly valued.  To see the individual valuation articles, please click on the company name in the table below.

Ticker Name with Link Investor Type Latest Valuation Date MG Value Recent Price Price as a percent of Value PEmg Ratio Dividend Yield
AXP American Express Company E 4/30/2015 $132.71 $78.94 59.48% 15.82 1.47%
AAPL Apple Inc. S 12/12/2014 $215.50 $130.75 60.67% 23.35 1.59%
BA Boeing Co E 5/17/2015 $195.80 $145.14 74.13% 20.94 2.51%
CAT Caterpillar Inc. D 4/21/2015 $176.91 $82.21 46.47% 12.75 3.75%
CSCO Cisco Systems, Inc. D 5/4/2015 $32.94 $27.84 84.52% 16.77 3.02%
CVX Chevron Corporation S 6/2/2015 $33.69 $93.90 278.72% 10.88 4.56%
DD E I Du Pont De Nemours And Co E 5/7/2015 $75.14 $59.28 78.89% 14.78 3.31%
DIS Walt Disney Co S 11/19/2014 $100.82 $119.34 118.37% 34.89 1.11%
GE General Electric Company S 3/2/2015 $9.65 $26.84 278.13% 20.18 3.43%
GS Goldman Sachs Group Inc S 11/10/2014 $71.04 $211.66 297.94% 15.12 1.23%
HD Home Depot Inc S 11/10/2014 $126.71 $113.80 89.81% 32.06 2.07%
IBM International Business Machines Corp. S 11/11/2014 $357.65 $163.08 45.60% 11.06 3.19%
INTC Intel Corporation D 5/18/2015 $32.91 $28.72 87.27% 13.74 3.34%
JNJ Johnson & Johnson D 6/1/2015 $85.77 $100.36 117.01% 19.08 2.99%
JPM JPMorgan Chase & Co. D 6/1/2015 $113.90 $69.08 60.65% 13.57 2.55%
KO The Coca-Cola Co S 3/3/2015 $19.68 $41.22 209.45% 22.28 3.20%
MCD McDonald’s Corporation S 11/11/2014 $99.75 $97.32 97.56% 18.75 3.49%
MMM 3M Co E 4/27/2015 $131.77 $155.79 118.23% 21.67 2.63%
MRK Merck & Co., Inc. S 11/12/2014 $8.19 $58.68 716.48% 26.31 3.07%
MSFT Microsoft Corporation D 5/4/2015 $32.40 $47.28 145.93% 19.22 2.62%
NKE Nike Inc E 5/11/2015 $74.61 $113.00 151.45% 38.18 0.99%
PFE Pfizer Inc. E 6/11/2015 $60.91 $35.14 57.69% 17.31 3.19%
PG Procter & Gamble Co S 2/16/2015 $31.58 $81.67 258.61% 20.99 3.24%
TRV Travelers Companies Inc D 5/15/2015 $253.10 $104.46 41.27% 11.87 2.34%
UNH UnitedHealth Group Inc S 11/15/2014 $136.02 $120.90 88.88% 22.85 1.65%
UTX United Technologies Corporation S 11/15/2014 $119.90 $102.68 85.64% 16.75 2.49%
V Visa Inc E 5/22/2015 $75.87 $72.04 94.95% 36.57 0.67%
VZ Verizon Communications Inc. S 3/4/2015 $37.76 $46.96 124.36% 22.26 4.68%
WMT Wal-Mart Stores, Inc. S 11/19/2014 $83.92 $72.75 86.69% 15.00 2.69%
XOM Exxon Mobil Corporation S 6/4/2015 $42.51 $81.63 192.03% 12.64 3.58%

Disclaimer:  The author held a long position in DIS and HD but did not hold a position in any other company mentioned in this article at the time of publication.

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