The Nasdaq Composite's (NASDAQINDEX:^IXIC) performance in 2013 beat the Dow Jones Industrial Average (DJINDICES:^DJI) by 37% to 27%. But most of the gains were due to multiple expansion, and now the Nasdaq's average P/E ratio is 24 to just 16 on the Dow.
Investors looking for value in an economy that's growing at a snail's pace should look to the Dow for better options. In fact, value is why the Dow will outperform the Nasdaq this year.
In the video below, Motley Fool contributor Travis Hoium highlights why Verizon (NYSE:VZ), Microsoft (NASDAQ:MSFT), and Cisco (NASDAQ:CSCO) provide the kind of value and competitive moat that investors should be looking for in 2014.
Boost your 2014 returns with The Motley Fool's top stock
There's a huge difference between a good stock and a stock that can make you rich, particularly in this market. The Motley Fool's chief investment officer has selected his No. 1 stock for 2014, and it's one of those stocks that could make you rich. You can find out which stock it is in the special free report, "The Motley Fool's Top Stock for 2014." Just click here to access the report and find out the name of this under-the-radar company.
Travis Hoium manages an account that owns shares of Cisco Systems and Verizon Communications. The Motley Fool recommends Cisco Systems, Facebook, Tesla Motors, and Twitter. The Motley Fool owns shares of Facebook, Microsoft, and Tesla Motors. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.