The Dow Jones Industrial Average is a benchmark index of the top 30 companies in the US. It represents the strength of the US economy and carries great historical significance as well.
It also acts as a reference point for analysts and investors. However, not all stocks within this elite group of companies perform equally. While some thrive on innovation and economic boom, others struggle due to various setbacks and economic trends.
We decided to break down the index and find out the best and worst stocks, looking at what was making them perform unexpectedly this year.
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Methodology
In order to come up with our ranking of the best and worst Dow stocks, we first assigned a rank to each stock based on the number of hedge funds holding the stock. We then looked at the short interest in each stock and assigned the top rank to the company with the least short interest.
We then combined the two ranks to see which stock was the best on average. The list is in ascending order, with the best stock taking the number one spot.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
30. International Business Machines Corporation (NYSE:IBM)
Number of Hedge Fund Holders: 60
Short Interest as of Apr 30, 2025: 2.27%
International Business Machines Corporation is an integrated solutions and services provider. The company operates in Infrastructure, Software, and Financing segments. The company is among the top 5 most shorted stocks on the Dow.
To accelerate manufacturing and technology innovation, the tech giant plans to invest $150 billion during the next five years in the US. As part of this investment, more than $30 billion will be allocated to research and development to improve the manufacturing of mainframe and quantum computers in America.
IBM’s CEO Arvind Krishna said on the occasion:
“We have been focused on American jobs and manufacturing since our founding 114 years ago, and with this investment and manufacturing commitment we are ensuring that IBM remains the epicenter of the world’s most advanced computing and AI capabilities.”
Due to the potential negative effects of the U.S. Department of Government Efficiency (DOGE), the company highlighted concerns about its Consulting business over the next few months. CEO Arvind Krishna mentioned that this segment could be at serious risk if discretionary spending cuts are initiated by DOGE.
Despite reporting better-than-expected first-quarter results, the company’s shares fell 5%. Management reiterated its full-year guidance reflecting 5% revenue growth along with the free cash flow generation of $13.5 billion.
29. NIKE, Inc. (NYSE:NKE)
Number of Hedge Fund Holders: 73
Short Interest as of Apr 30, 2025: 4.35%
NIKE, Inc. operates as a developer, designer, marketer, and seller of apparel, athletic footwear, accessories, equipment, and services. Following President Donald Trump’s social media post about a productive call with Vietnam’s leaders on trade restrictions, the company’s shares surged around 4.5%.
However, NKE is the most shorted stock on the Dow with a short interest of 4.35%. It has lost over one-third of its value in the last year, with the company management lobbying to get an exemption from tariffs to protect American consumers.
There is reason to believe that an exemption may be on the cards. Earlier in April, Trump was approached by the Vietnamese authorities and this was how he responded:
“Just had a very productive call with To Lam, General Secretary of the Communist Party of Vietnam, who told me that Vietnam wants to cut their tariffs down to ZERO if they are able to make an agreement with the U.S. I thanked him on behalf of our country and said I look forward to a meeting in the near future.”
In partnership with Kim Kardashian’s SKIMS, the athletic apparel giant is preparing to launch a new brand. The firm is organizing a team of designers and executives for the launch of a new spring collection. The NikeSkims project will include footwear, training apparel, and accessories, aiming for global expansion in 2026.
NIKE has recently announced another partnership with Ja Morant and Kraft-Heinz’s Kool-Aid brand. This deal aims to launch a new shoe collaboration, the Nike x Kool-Aid Ja 2. This partnership blends nostalgia, creativity, and sneaker culture, highlighting Ja’s personality.
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