4 Dow Shares to Watch in March

One benefit of following the Dow Jones Industrials (DJINDICES: ^DJI) is that there’s always something going on with the 30 companies that make up the average. As the leaders of the U.S. economy and with presence throughout the world, the prospects of these companies have global implications for economic growth and prosperity.

With that in mind, there are 4 companies in the Dow 30 that are especially worth paying attention to this month. Let’s take a closer look at these companies to find out what’s in store.

1. Wal-Mart (NYSE: WMT)
After fighting reports of alleged corruption, the last thing Wal-Mart needed was another controversy. But conflicting news about the retail giant’s prospects have investors watching the company to see which version of its story proves correct.

On one hand, Wal-Mart beat earnings estimates in its fourth-quarter report. The retailer posted 1.3% same-store sales gains, came out with a strong earnings report last month. But leaked internal emails among Wal-Mart executives referred to “disastrous sales” for the beginning of 2013, and that prompted the company to temper its guidance for the current quarter. Wal-Mart cited a two-percentage-point rise in payroll taxes, rising gasoline prices, and the US Inland Revenue Service delays in processing tax refunds for its flat sales. This has raised fears of whether a big financial hit to the retailer’s customer base will mean a return to the falling sales trends that lasted for years following the financial crisis.

Wal-Mart doesn’t provide monthly same-store sales figures. But you’ll want to watch closely for any further guidance from the retailer about the current quarter, especially as pressure continues to build on lower-income customers.

2. Home Depot (NYSE: HD)
One of the biggest drivers of the stock market’s rally lately has been the housing market, which has finally started picking up. Home Depot was a big beneficiary of that trend in 2012, and the company has continued to see its stock move higher on optimism for the future.

Its favourable earnings report last week which included both a higher dividend and a new share-repurchase program.  Home Depot looks poised to take out its all-time record high of $70 per share. Yet at 23 times trailing earnings, the home-improvement retailer will need to see housing keep performing well to justify the lofty share price.

3. Disney (NYSE: DIS)
Once again, Disney is hoping for success from a March movie. Despite bad memories of 2012 box-office flop John CarterOz the Great and Powerful should have more box-office appeal when it comes out March 8, if only because of its connection to the much-loved 1939 classic Wizard of Oz. Yet with somewhat mixed reviews early on, investors will be watching the much-anticipated release very closely.

Long-term investors may secretly be rooting for a bad result from Oz to help send Disney’s shares down temporarily as the real potential for Disney is in its future. The Lucasfilm acquisition promises billion-dollar blockbusters for years to come and content deals are just starting to ramp up.

4. JPMorgan Chase (NYSE: JPM)
JPMorgan CEO Jamie Dimon is no stranger to controversy. Last week’s news that the bank will cut 17,000 jobs in the coming two years again raised strong reactions from those who’ve criticized the outspoken executive in the wake of billions in losses from the London Whale scandal. This was in spite of Dimon’s having taken a pay cut as a result of those losses.

But with the layoffs coming largely from the bank’s mortgage business, which needs fewer people to process a falling number of loans in default, JPMorgan appears to be getting healthier. This month’s release of bank stress test results should give confirmation of that trend and potentially set the stage for another round of dividend increases for bank shareholders across the industry. With financials having led the rally higher in stocks, watch closely for any signs that banking in general and JPMorgan in particular haven’t improved as much as most investors believe.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. This article was written by Dan Caplinger, and first published on Dan owns warrants on JPMorgan Chase.