Key Points
A high-profile investor has taken a bullish interest in struggling health insurer UnitedHealth.
Apple’s tariff risks are also abating, thanks to an increase in its investment in American manufacturing capacity.
Two familiar names tied for third, each benefiting from evidence and expectations of continued economic strength.
With its gain of 3.2%, the Dow Jones Industrial Average (DJINDICES: ^DJI) outperformed most other major market indexes in August. Only a small handful of the Dow's constituents, however, did the bulk of this heavy lifting.
Health insurer UnitedHealth Group (NYSE: UNH) led the way with its 24% advance, although the company itself didn't do anything to merit it. Rather, give credit to Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B), which announced a new 5-million-share stake in the struggling stock last month. Shares had fallen more than 60% from their April peak to early August's multiyear low on a near-halving of its full-year profit guidance (largely due to unexpectedly high reimbursement costs). Warren Buffett and Berkshire's lieutenants, however, clearly feel the sellers overshot their target. Investors interpreted Berkshire's interest as a bullish clue.
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Apple (NASDAQ: AAPL) finished a distant second to UnitedHealth, advancing nearly 12% last month. The company's solid fiscal third-quarter results posted in late July helped the stock hit the ground running in August. But an announcement of an additional $100 billion investment (bringing the total up to $600 billion) in its American manufacturing capacity that immunizes its iPhone from import tariffs arguably accounts for most of Apple stock's August gain.
Data by YCharts.
Finally, retailer Home Depot (NYSE: HD) and credit card issuer American Express (NYSE: AXP) tied for last month's third-best performance among the Dow's stocks, each with a gain of 10.7%. Home Depot shares edged higher all month long despite its Q2 top and bottom lines reported in mid-August both missing analyst estimates; investors saw enough glimmers of hope in the company's same-store sales growth of 1.4% and the reaffirmation of this year's earnings and revenue guidance. There was no major news from or about American Express released last month. Given its healthy Q2 numbers released in July, however, it easily plugged into the broad market bullishness.
While these market-beating gains are compelling, interested investors will still want to do their usual due diligence before buying into any of these stocks.
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American Express is an advertising partner of Motley Fool Money. James Brumley has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple, Berkshire Hathaway, and Home Depot. The Motley Fool recommends UnitedHealth Group. The Motley Fool has a disclosure policy.