Top Dow stocks in August and where analysts see them going next

Published Sun, Sep 1 20246:57 AM EDT

These stocks have led the Dow Jones Industrial Average higher in August, and investors believe all but two of them are poised for more upside. This comes as the month has been a volatile one for stocks. In early August, lackluster jobs data for July sparked fears that the U.S. economy was headed for a recession, sending the market into chaos. That global market sell-off saw the Dow post its worst day in almost two years , dropping more than 1,000 points. The session marked the biggest daily loss since September 2022 for the blue-chip index, as well as the S & P 500 . Since then, the Dow has recovered, moving about 1.8% higher month-to-date, as of Friday's close. As the month wrapped up, CNBC Pro looked at the Dow's top 10 performers for August, and then juxtaposed them against where analysts stand. Here are the names in the screen: Walmart leads the Dow this month after seeing big gains in the period. Not only are shares up around 12.5% month-to-date but they're also up about 47% year-to-date. This makes it the S & P's best performing consumer staples stock this year, per FactSet. WMT YTD mountain Walmart, year-to-date Still, analysts remain bullish on the retailer. The average price target among investors implies 6.6% upside ahead from Wednesday's close, according to LSEG. What's more, 70.3% of investors have issued buy ratings on the stock. McDonald's is right behind Walmart as the third-best Dow leader this month, according to FactSet, with shares up nearly 9% month-to-date. With 47.4% of investors issuing a buy rating on the stock, its average price target implies 3% upside from Wednesday's close. Among them, Wolfe Research recently reiterated McDonald's at peer perform, saying burger chain's release of collectible cups has conjured up nostalgic feelings. The cups are based on iconic McDonald's collectibles from past decades. "We like McDonald's nostalgia marketing efforts given they have the ability to generate excitement from consumers, help boost traffic, and improve consumer perception of the brand to bring consumers back to McDonald's regularly (given negative social media sentiment regarding prices earlier this year)," analyst Greg Badishkanian wrote in a Tuesday note. Health-care stock Merck has the biggest upside of all the Dow leaders on the list, given that its trading level at Wednesday's close implies a 19.5% increase to its average price target. It also has the greatest percentage of buy ratings on the list at 71.4%. The stock is up 4.7% this month and more than 8% in 2024. Meanwhile, Coca-Cola and International Business Machines are the only two Dow leaders that have a bearish outlook – their average price targets imply downside of 1.2%. Shares are still positive on the month, as Coca-Cola and IBM are up more than 8% and 5.2% month-to-date, respectively.