UnitedHealth Group Inc. (UNH), Wal-Mart Stores, Inc. (WMT), Bank of America Corp (BAC): The Big Winners for the Dow Today

The Dow Jones Industrials started off the week with a gain of almost 89 points, continuing its strong run upward over the past week or so. But starting tonight, the average will start looking for the earnings growth it needs to sustain its rally. At a time of maximum anxiety among investors about earnings prospects, we’ll see in the coming days and weeks how the latest quarterly releases match up with the long-term expectations that investors have for various stocks and industries. How those companies do could either continue the Dow’s uptrend or lead to a market reversal.

UnitedHealth Group Inc

Today, though, the biggest winners in the Dow were those with fairly solid earnings prospects. UnitedHealth Group Inc. (NYSE:UNH) climbed more than 2% after Barron’s gave favorable comments about the health-insurance company’s ability to profit from the implementation of Obamacare. Although most analysts have focused on the company’s insurance business, UnitedHealth Group Inc. (NYSE:UNH) also includes its Optum health-services and management arm, which stands to get huge growth from efforts to attach rising health-care costs at the source by preventing and changing harmful behavior among patients. If those prospects work out, then UnitedHealth Group Inc. (NYSE:UNH) could benefit on both sides of its overall business.

Wal-Mart Stores, Inc. (NYSE:WMT) also jumped 2%, signaling a departure from its usual lower-volatility performance. The retailer is already so huge that substantial growth is difficult for Wal-Mart Stores, Inc. (NYSE:WMT) to muster, but analysts still see the company posting earnings growth of about 5% this year and 10% next year as it continues to make moves to capture new segments and strengthen its hold over existing ones. What many people don’t realize about Wal-Mart Stores, Inc. (NYSE:WMT) is that like many retailers, it has a substantial presence overseas, and revenue in its international division has grown at a much faster rate of almost 40% over the past three years, compared to just 7% for its U.S. sales.

Finally, Bank of America Corp (NYSE:BAC) rose 1.7% despite new regulations imposing a 5% leverage ratio on the largest banks in the country. That’s even stricter than the Basel III international banking regulations called for, but the FDIC believes that requiring Bank of America Corp (NYSE:BAC) and its other large-bank peers to set aside common equity capital of 5% of total assets will ensure greater stability in a financial crisis. Banks could see pressure on lending from the need to restrain leverage, but the big move is that off-balance-sheet accounting won’t prevent banks from having to consider them as part of their own operations for calculating the ratio. With higher mortgage rates already eating into non-interest income, it’s surprising to see Bank of America Corp (NYSE:BAC) shares rise, although in the long run, a steeper yield curve might do more good for the bank’s profits.

The article The Big Winners for the Dow Today originally appeared on Fool.com.

Fool contributor Dan Caplinger owns warrants on Bank of America. You can follow him on Twitter: @DanCaplinger. The Motley Fool recommends Bank of America and UnitedHealth Group and owns shares of Bank of America.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The Best B-Boy Movies

Most Awesome Hip Hop Documentaries

Foods That Stain Your Teeth

Richest Doctors in the World

The Best Movie Sountracks Ever

The Highest Grossing Musicals on Broadway

The Most Successful Reality TV Stars

Cheapest Cities to Visit in the US

Most Expensive Summer Camps

Most Expensive Animals in the World

Most Expensive Specialty Crops in the World

Movies That Took Ages to Make

The Longest Hollywood Films Ever Made

Most Expensive Concert Stages

The Richest Bands of all Time

10 Most Corrupt Countries 2013 List

10 Countries with the Highest Quality of Life Index

Most Expensive Mattresses in the World

5 Smallest Countries by Land Area

The Ultimate Heartbreak Songs

Richest Teenagers in the World

10 Most Haunted Places in America

10 Best Places to Retire in Florida East Coast

Top 10 Places to See Before You Die

Top 8 Countries in the World Where Justice Prevails

10 Richest States in America

15 Wealthiest Countries in the World

Richest Singers in the World

Most Expensive Tasting Menu in New York City

Most Expensive Baby Items in the World

Most Expensive Hotel Suites in Vegas

Most Expensive Brunch in New York City

Most Expensive Beef Cuts in the World

25 Best Colleges to Get a Job

Top 10 US Supermarkets

The 25 Most Dangerous Cities in the World to Visit

Most Expensive Xbox Games

Top 11 Cities Where Billionaires Live

Top 10 Most Charitable Companies in America

Most Expensive Seafood in the World

The 10 Wildest Conspiracy Theories

The 10 Best Job Markets in the US

Top 10 Accounting Scandals of All Time

The 25 Biggest Cities in the World

Top 10 Best Paying Virtual Jobs

Most Expensive Leather Shoes in the World

Top 6 Things to Buy in March

The 10 Most Stressful Jobs in America – 2014 List

Top 10 Jobs for Introverted People

Top 10 Honeymoon Destinations in the World

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!