Home Depot has fallen 2 percent this quarter, in contrast to the Dow’s near 3 percent gain, due primarily to a 4 percent drop on July 20. That day, the stock dragged down the Dow after Sears announced it will sell its Kenmore-branded appliances on Amazon.com and integrate some of the products with Amazon’s Alexa technology.
BTIG analysts Alan Rifkin and Marvin Fong said in a July 20 note that the decline in Home Depot’s share price was likely “a major overreaction” to the Sears-Amazon news and maintained a buy rating on the stock. The analysts pointed out that appliances accounted for 8 percent of sales in 2016 for Home Depot.
Home Depot is scheduled to report earnings before the U.S. market open on Aug. 15.
A recovery in Pfizer shares, down about 2.5 percent this quarter, could also help the Dow rise.
On Wednesday, BMO Capital Markets senior equity analyst Alex Arfaei upgraded Pfizer to outperform from underperform, citing expectations for “a number of potential blockbuster growth opportunities” that could help the stock break out of a post-U.S. election trading range.
Other stocks that will likely take the Dow higher include Cisco Systems, which the Street expects to rise 13 percent from Tuesday’s close, and Apple and McDonald’s, which both have 12 percent to climb in order to hit the average Street price target.
Based on their average price targets, analysts expect all the Dow stocks to rise except for 3M, which closed Tuesday exactly at the average price target, and Travelers Cos., for which the Street’s average target is 2 percent below Tuesday’s close.
— CNBC’s John Melloy and Gina Francolla contributed to this report.