The Dow Jones Industrial Average (INDEX: ^DJI ) opened down and finished lower after the Federal Reserve released minutes from its March meeting; however, some stocks did much better than the Dow as a whole.
Source: Google Finance.
Today's Top 3
1. On a day when 25 of the 30 Dow components finished lower, today's leader was McDonald's (NYSE: MCD ) . The fast-food giant rose 1.06% [$1.04] to $99.40, despite an announcement from Burger King of changes to its menu to make it more similar to McDonald's. They say imitation is the sincerest form of flattery, and it's hard to blame a competitor for following the lead of the Dow's top performing stock last year, when McDonald's rose 30.7%. So far this year, though, the stock is relatively unchanged, and it's worth noting that Fool analyst Alex Dumortier believes McDonald's stock will disappoint investors going forward.
2. Fool analyst Sean Williams believes credit card services companies are the dividend juggernauts of the future. Will American Express (NYSE: AXP ) prove him right? AmEx stock was second behind McDonald's today, up 1.00% [$0.58] to end at $58.39. Three weeks ago, it was one of the companies that passed the Federal Reserve's annual stress test of banks. After the results were published, JPMorgan Chase, Wells Fargo, and US Bancorp all announced dividend raises and stock buybacks, and investors expected American Express to do the same. Sure enough, last Monday, the credit card behemoth announced that it's raising its dividend by $0.02 per quarter to $0.20, for a 1.37% yield, and enacting a new 150 million share-buyback authorization. The company said it plans up to $4 billion of share repurchases in 2012, and at today's price that come out to around 68 million shares, or 5% of the company.
3. Merck (NYSE: MRK ) took third for the day, up 0.55% [$0.21] to $38.72 on no news. Last month, Fool analyst Ilan Mosovitz labeled Merck as one of the 10 Worst Dow Stocks to Buy based on its P/E, estimated earnings growth, and dividend yield. There are some things to like about Merck, though, such as its applying for FDA approval of eight new drugs in 2012 and 2013. But it remains to be seen how those will turn out.
The best approach
Watching the broad market each day is exciting, gut-wrenching, and stressful, but investing doesn't have to be. If you're in the mood to pick up a few great companies to buy for the long term, The Motley Fool has created a brand-new free report: "3 Stocks That Will Help You Retire Rich." It features three stocks to help you build a smarter retirement portfolio. Get access to the report and find out the name of these three companies. The report is free, but it won't be here forever, so check it out today.