3 Dow Jones Stocks We Steer Clear Of

The Dow Jones (^DJI) is made up of 30 of the most established and influential companies in the market. But even blue-chip stocks can struggle - some are dealing with slowing growth, outdated business models, or increasing competition.

Finding the best companies in the Dow Jones isn’t always straightforward, and that’s why we started StockStory. That said, here are three Dow Jones stocks to avoid and some better opportunities instead.

Disney (DIS)

Market Cap: $181.4 billion

Founded by brothers Walt and Roy, Disney (NYSE:DIS) is a multinational entertainment conglomerate, renowned for its theme parks, movies, television networks, and merchandise.

Why Should You Sell DIS?

1. Annual sales growth of 9.5% over the last five years lagged behind its consumer discretionary peers as its large revenue base made it difficult to generate incremental demand
2. Subpar operating margin of 14.8% constrains its ability to invest in process improvements or effectively respond to new competitive threats
3. Ability to fund investments or reward shareholders with increased buybacks or dividends is restricted by its weak free cash flow margin of 8.2% for the last two years

At $102.50 per share, Disney trades at 14.8x forward P/E. Read our free research report to see why you should think twice about including DIS in your portfolio.

Sherwin-Williams (SHW)

Market Cap: $82.64 billion

Widely known for its success in the paint industry, Sherwin-Williams (NYSE:SHW) is a manufacturer of paints, coatings, and related products.

Why Are We Hesitant About SHW?

1. Annual sales growth of 1.1% over the last two years lagged behind its industrials peers as its large revenue base made it difficult to generate incremental demand
2. Projected sales growth of 4.2% for the next 12 months suggests sluggish demand
3. Earnings growth over the last two years fell short of the peer group average as its EPS only increased by 5.2% annually

Sherwin-Williams is trading at $335.78 per share, or 29.2x forward P/E. If you’re considering SHW for your portfolio, see our FREE research report to learn more.

Cisco (CSCO)

Market Cap: $316 billion

Founded in 1984 by a husband and wife team who wanted computers at Stanford to talk to computers at UC Berkeley, Cisco (NASDAQ:CSCO) designs and sells networking equipment, security solutions, and collaboration tools that help businesses connect their systems and secure their digital operations.

Why Do We Think Twice About CSCO?

1. Large revenue base makes it harder to increase sales quickly, and its annual revenue growth of 1.6% over the last two years was below our standards for the business services sector
2. 5.9 percentage point decline in its free cash flow margin over the last five years reflects the company’s increased investments to defend its market position
3. Waning returns on capital imply its previous profit engines are losing steam

Cisco’s stock price of $80.06 implies a valuation ratio of 18.9x forward P/E. To fully understand why you should be careful with CSCO, check out our full research report (it’s free).

Stocks We Like More

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Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.