The 3 Key Dow Stocks to Watch Next Week

Wall Street had a tough week, but major stock indexes mounted a comeback on Friday. After having seen sizable losses earlier in the day, the Dow Jones Industrial Average (^DJI -0.96%) battled its way back to finish basically flat. Losses for the S&P 500 (^GSPC -0.46%) and Nasdaq Composite (^IXIC -0.69%) were also much more modest than they had been earlier in the trading session.

Data source: Yahoo! Finance.

A trio of Dow stocks will report financial results next week. Home Depot (HD -0.30%), Cisco Systems (CSCO -0.28%), and Walmart (WMT 0.63%) all have exposure to the economic slowdown, but they also have the potential to keep producing solid long-term results. Below, you'll get a closer look at these three stocks to see what to expect next week.

Investors are watching housing's impact on Home Depot

Home Depot reports before the opening bell on Tuesday morning, and investors are already downbeat about the home improvement retailer's prospects. Most of those following the stock expect Home Depot to see sales drop by a double-digit percentage, with earnings per share falling 15% to $3.46 per share.

Many concerns about Home Depot stemmed from its February quarterly report. The home improvement retailer only managed to post a less than 1% rise in revenue, with new store openings offsetting declines in comparable store sales. Similarly, earnings inched higher by 3% year over year to $3.30 per share.

A host of headwinds are hitting Home Depot. Macroeconomic concerns could force consumers to spend less on home improvement efforts, but Home Depot also expects to spend more to retain employees. What investors will want to see on Tuesday is whether weakness in housing will flow through to the retailer's financials, and if it does, then further share-price weakness could be in store.

Cisco aims to bounce back

Cisco has scheduled its earnings release for Wednesday afternoon after the closing bell. The networking specialist has investors feeling optimistic, with projections for a 12% rise in revenue year over year and an 11% boost to earnings to $0.97 per share.

Cisco shares have performed poorly in the recent past, as many investors fear that companies will pull back on their tech spending. Yet the networking specialist has increasingly emphasized its growing software business, which features better margins than its core hardware offerings as well as the security of recurring subscription revenue. Moreover, Cisco has concentrated on must-have elements of digital transformation, further supporting its business.

Cisco investors also like the stock's dividend, which works out to a yield of 3.3%. For those who see the long-term potential of tech, that payout is a nice thing to have as you wait for more encouraging economic conditions to return.

Walmart's results could have broad implications

Last up is Walmart, which will report its results on Thursday. Most investors expect modest declines of 4.5% on the revenue front and an 8% to 9% drop in earnings.

Walmart is at the center of a debate right now. On the one hand, the retail giant has worked hard to bolster its grocery offerings and fight back against e-commerce giants with its Walmart+ subscription-based membership service. However, its higher-ticket business is seeing economic weakness as consumers pull back from big purchases.

If Walmart can show that it's working to expand margins without having to give up revenue growth, then the stock could continue to push to all-time highs. If not, though, then Walmart's stock could be the first sign of cracks in the strength of the broader stock market.