You can find big winners in a sleepy old index that many investors ignore these days. Amazon(NASDAQ: AMZN), Disney(NYSE: DIS), and Coca-Cola(NYSE: KO) are three of the 30 stocks that make up the Dow Jones Industrial Average(DJINDICES: ^DJI).
I think these three stocks have the right combination of catalysts and valuation to beat the market this year, and in the years to come. Let’s take a closer look.
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The leading online retailer is one of the more dynamic names on the Dow 30. It’s a steady producer, growing its revenue every year since going public in 1997. Even better, Amazon has failed to deliver at least double-digit top-line growth just once over the past 30 years. You’re doing pretty well if your worst year in the past three decades was a 9% increase in net sales for 2022.
Profitability has been a bit more volatile, understandably, but it has a not-so-secret weapon in its arsenal: Amazon Web Services (AWS) is the e-tailer’s cloud-hosting business. It’s a high-margin beast. It delivered only 22% of the top-line results in Amazon’s latest quarter, but a whopping 66% of its net operating income. AWS is a needle-mover, helping Amazon’s overall gross profit margin double to 50% on a trailing basis over the past 13 years.
This is a good time to warm up to the bellwether for online retailing. Amazon stock was the worst performer of the “Magnificent Seven” stocks last year. Its 5% gain in 2025 lagged its Mag 7 peers, clocking in at a third of the overall market’s return. In a year in which Amazon delivered accelerating growth in net sales with the bottom line growing even faster, it’s a prime candidate to bounce back in 2026.
You won’t have to wait long to see Amazon on the move. It reports results for its holiday-packed fourth quarter next week. Expectations are low, with Wall Street pros targeting a 5% increase in adjusted earnings on a 12% step up in net sales. The good news is that Amazon has topped analyst profit targets by at least 17% in each of the past four quarters.
Another stock that languished in 2025 was Disney. The Mickey Mouse company fared slightly worse than Amazon, with a 4% return last year. Revenue accelerated slightly in fiscal 2025, and adjusted net income climbed 19%.
Disney’s narrative has turned bullish since its streaming business became profitable midway through fiscal 2024. For the second calendar year in a row, Disney put out the three highest-grossing movies by a U.S. studio.
Disney stock is trading for less than 17 times this fiscal year’s earnings estimates. It’s the cheapest of the three stocks on this list. And it won’t take more than just a dash of pixie dust to send it higher in 2026.
On the bubbly surface, Coca-Cola may not seem like a bargain these days. Shares of the pop star are trading for 23 times forward earnings. That seems like a steep multiple for a slow-growing company, expected to grow its sales and earnings by 5% and 8%, respectively, in 2026. But then you factor in things such as Coca-Cola’s global dominance among beverage stocks, low beta, and monster streak of 63 consecutive years of annual dividend increases.
Let’s twist the cap off the last point, first. Coca-Cola is a Dividend King. Only eight other companies have longer streaks of annual payout boosts. Next month, Coca-Cola should stretch that run of distribution boosts to 64 years.
Let’s turn to its dominance worldwide. You may have heard the bearish argument that consumption of sugary and even diet soft drinks has been steadily declining in the U.S. for decades. It’s true, but this is a global business, and it’s been able to pass along higher prices. Revenue growth has been positive in each of the past five years, and the bottom line is faring even better. Its trailing net income margin of 27.3% is the strongest it’s been in 15 years.
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Rick Munarriz has positions in Walt Disney. The Motley Fool has positions in and recommends Amazon and Walt Disney. The Motley Fool has a disclosure policy.
