Track the companies that matter to you. It's FREE! Click one of these fan favorites to get started: Apple; Google; Ford.



Why These 3 Dow Stocks Surged This Week

After a slew of earnings reports, the Dow Jones Industrial Average (INDEX: ^DJI  ) gained 1.6% this week.

But three stocks crushed the others:


Weekly Price Change

AT&T (NYSE: T  ) 5.9%
Boeing (NYSE: BA  ) 5.1%
American Express (NYSE: AXP  ) 4.7%

So what's going on with these companies?

The cell giant barely grew its subscriber base this quarter and posted earnings of $0.60 per share, slightly above what analysts had expected. But what really had investors excited was that it and Verizon improved their margins by earning more from data plans.

That's important because AT&T's operating margins have fallen from around 17% to 13% over the past several years, and compressing margins is one of the biggest risks facing the major carriers. As Apple (Nasdaq: AAPL  ) iPhones become increasingly popular, the smartphone maker gains more market power over AT&T, Verizon, and Sprint Nextel to provide generous subsidies for its phones. Apple's free cash flow was skewed $10 billion higher than net income over the past year, largely because of the impact of those massive subsidies.

Boeing's quarterly earnings rose 58% over the past year, and the company said it's been able to reduce costs by about half for its new, long-awaited 787 Dreamliner planes since it began producing them. Margins and backlogs rose, and Dreamliner production is expected to increase to 10 per month by the end of next year.

American Express
Shares of AmEx soared last week after it posted a 7% earnings on a 12% increase in transactions. The card giants -- Visa, MasterCard, AmEx, and Discover Financial Services -- are hitting 52-week highs, with their businesses firing on all cylinders. Consumers are processing more of their transactions with cards instead of cash, and emerging-market growth is beginning to hit its stride. With 85% of transactions still done in cash, there's still quite a bit of room for growth.

AT&T, Boeing, and AmEx crushed the market this week. If you're looking for some other great blue-chip stock ideas, check out The Motley Fool's "3 American Companies Set to Dominate the World." In this special report, our analysts reveal three tantalizing stocks that are finding growth in emerging economies. You can access the report for for free

Ilan Moscovitz owns shares of Apple. You can follow him on Twitter, where he goes by @TMFDada. The Motley Fool owns shares of MasterCard and Apple. Motley Fool newsletter services have recommended buying shares of Visa and Apple, creating a write covered strangle position in American Express, and creating a bull call spread position in Apple. The Motley Fool has a disclosure policy. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.

Read/Post Comments (0) | Recommend This Article (5)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1874267, ~/Articles/ArticleHandler.aspx, 10/24/2016 2:18:04 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated Moments ago Sponsored by:
DOW 18,220.77 75.06 0.41%
S&P 500 2,150.25 9.09 0.42%
NASD 5,304.74 47.34 0.90%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

10/24/2016 2:02 PM
^DJI $18222.96 Up +77.25 +0.43%
AAPL $117.69 Up +1.09 +0.93%
Apple CAPS Rating: ****
AXP $67.18 Down -0.19 -0.27%
American Express CAPS Rating: ****
BA $137.75 Up +2.12 +1.56%
Boeing CAPS Rating: ****
T $36.78 Down -0.72 -1.91%
AT and T CAPS Rating: ****