November is typically the best month of the year for these 4 Dow stocks

Published Tue, Oct 31 20233:07 PM EDT

Despite a bleak month in October for the stock market, there may be some good news in store for at least four stocks in the Dow Jones Industrial Average . All three major market indexes are in the red this month, with the Dow off by 1.5% since the end of September. But investors may find some relief heading into the year end, since historically November has been a strong month for stocks. Data from the Stock Trader's Almanac shows that the Dow Industrials have historically gained an average of 1.7% in every November since 1950. CNBC Pro looked at the average monthly performance for all the stocks that are now in the Dow, going back the past 20 years. Of the 30 stocks included in the average, four of them have historically posted their biggest gain of the year each November. For example, shares of Caterpillar have on average gained 5.1% in November, a stark contrast to their 17% selloff so far this month on the back of poor forward guidance. The construction equipment manufacturer is the biggest laggard in the Dow in October. Analysts surveyed by LSEG have an average rating of hold on Caterpillar. Based on a consensus price target of $288, Caterpillar offers some 27% upside according to analyst estimates. Passenger jetmaker and defense manufacturer Boeing has also historically rallied 5.1% in November. The average analyst surveyed by LSEG has a buy rating on the stock, and the consensus price target implies potential upside of almost 30%. Shares of Boeing are down about 2.4% so far this month, after the 737 Max maker reported reported better-than-expected third-quarter revenue but a wider-than-expected adjusted loss per share. The stock fell following news of production flaws affecting the 737 Max. Insurance giant UnitedHealth has historically posted a 4.4% gain in November. Up 6% since October's start after sales and earnings topped analyst estimates in the third quarter, UNH is the only one of the four names that hasn't fallen in October. The average analyst has a buy rating on the stock, and the consensus price target of $595 corresponds to a possible 11% upside. UBS upgraded UNH earlier this month to a buy, calling it "a core holding available at a reasonable price." Also included on the list is industrial conglomerate 3M , which has historically added 2.8% in November. Analysts have an average hold rating on the Scotch Tape maker but the consensus price target would see the stock climb 19%. Shares of 3M jumped earlier this month after the company posted stronger-than expected earnings results, raising its forecast. Despite this, the stock has slipped 2.7% since the beginning of October. To be sure, seasonal trends are just one component of the larger picture for a stock's performance, and near-term macroeconomic headwinds may mean that history won't end up repeating this year. — CNBC's Christopher Hayes contributed to this report.