Intel Was Just Dropped From the Dow. History Says This Is What Will Happens Next.

Motley Fool11-05 17:40

Intel will be removed from the Dow and replaced by Nvidia. Over the last decade, results have been mixed for the stocks that have been removed from the Dow. Intel's turnaround efforts ...

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History Says This Is What Will Happens Next.\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-11-05 17:40 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://www.fool.com/investing/2024/11/05/intel-dropped-from-dow-djia-history-happen-next/><strong>Motley Fool</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Intel will be removed from the Dow and replaced by Nvidia.\n\n\n\n\n\n\n\nOver the last decade, results have been mixed for the stocks that have been removed from the Dow.\n\n\n\n\n\n\n\nIntel's turnaround efforts ...</p>\n\n<a href=\"https://www.fool.com/investing/2024/11/05/intel-dropped-from-dow-djia-history-happen-next/\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"LU1150488218.USD","symbol_name":"First Eagle Amundi Income Builder AU2-MD USD","start_time":0,"source_url":"https://www.fool.com/investing/2024/11/05/intel-dropped-from-dow-djia-history-happen-next/","article_id":"2481575307","we_media_id":null,"thumbnails":["https://g.foolcdn.com/image/?url=https%3A%2F%2Fg.foolcdn.com%2Feditorial%2Fimages%2F796320%2Fstock-market-chart.jpg&op=resize&w=165&h=104"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2481575307","pubTimestamp":1730799600,"sourceInfo":{"source_id":"fool_stock","name":"Motley Fool"},"weMediaInfo":null,"summary":"The legacy chipmaker faces another challenge.","collect":0,"end_time":0,"defaultTopTitle":"fool.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"LU1150488218.USD":"First Eagle Amundi Income Builder AU2-MD USD","LU0057025933.USD":"SUSTAINABLE GLOBAL THEMATIC PORTFOLIO \"AX\" (USD) ACC","LU0795875086.SGD":"JPMorgan Investment Funds - Global Income A (div) SGD","DJX":"1/100道琼斯","IE00BK4W5M84.HKD":"HSBC GLOBAL FUNDS ICAV US EQUITY INDEX \"HC\" (HKD) ACC","2NVD.UK":"2X NVIDIA ETP","DDM":"道指两倍做多ETF","IE00B19Z8X17.USD":"FTGF CLEARBRIDGE US LARGE CAP GROWTH  \"AG\" (USD) ACC","BK4201":"综合性石油与天然气企业","IE00BD6J9T35.USD":"NEUBERGER BERMAN NEXT GENERATION MOBILITY \"A\" (USD) ACC","LU0787776722.HKD":"AB SELECT US EQUITY PORTFOLIO \"A\" (HKD) ACC","NVDA":"英伟达","BK4592":"伊斯兰概念","BK4515":"5G概念","IE0034235303.USD":"PINEBRIDGE US RESEARCH ENHANCED CORE EQUITY \"A\" (USD) ACC","IE00B19Z8W00.USD":"FTGF CLEARBRIDGE US LARGE CAP GROWTH \"A\" INC","DOG":"道指反向ETF","HK0000320223.HKD":"TAIKANG KAITAI CHINA NEW OPPORTUNITIES FUND \"A\" (HKD) ACC","GE":"GE航空航天","IE00B4JS1V06.HKD":"JANUS HENDERSON BALANCED \"A2\" (HKD) ACC","BK4007":"制药","SG9999003800.SGD":"Nikko AM Global Dividend Equity Acc SGD-H","SG9999013999.USD":"UOB UNITED GLOBAL HEALTHCARE FUND (USDHDG) INC","SDOW":"道指三倍做空ETF-ProShares","SG9999001176.SGD":"UOB UNITED GLOBAL HEALTHCARE \"SGD\" (ACC)","HK0000320264.USD":"TAIKANG KAITAI CHINA NEW OPPORTUNITIES FUND \"A\" (USD) ACC","INTC":"英特尔","IE0034235295.USD":"PINEBRIDGE GLOBAL DYNAMIC ASSET ALLOCATION \"A\" (USD) ACC",".DJI":"道琼斯","LU0053666078.USD":"摩根大通基金-美国股票A（离岸）美元","BK4527":"明星科技股","LU0456855351.SGD":"JPMorgan Funds - Global Equity A (acc) SGD","IE00BJTD4V19.USD":"NEUBERGER BERMAN US LONG SHORT EQUITY \"A1\" (USD) ACC","UDOW":"道指三倍做多ETF-ProShares","LU1988902786.USD":"FULLERTON LUX FUNDS GLOBAL ABSOLUTE ALPHA \"I\" (USD) ACC","LU0098860793.USD":"FRANKLIN INCOME \"A\" INC","IE00BDCRKT87.USD":"PINEBRIDGE GLOBAL DYNAMIC ASSET ALLOCATION \"ADC\" (USD) INC","L":"洛斯公司","LU1267930813.SGD":"FRANKLIN TEMPLETON SHARIAH GLOBAL EQUITY \"AS\" (SGD) ACC","IE00BJJMRY28.SGD":"Janus Henderson Balanced A Inc SGD","IE00BJLML261.HKD":"HSBC GLOBAL EQUITY INDEX \"HCH\" (HKD) ACC","SG9999002232.USD":"Allianz Global High Payout USD","DXD":"道指两倍做空ETF","LU0320765646.SGD":"FTIF - Franklin Income A MDIS SGD-H1","3NVD.UK":"LS 3X NVIDIA","SG9999002224.SGD":"Allianz Global High Payout SGD","LU0225771236.USD":"SCHRODER ISF GLOBAL EQUITY YIELD \"A\" (USD) INC MF","IE00BK4W5L77.USD":"HSBC GLOBAL FUNDS ICAV US EQUITY INDEX \"HC\" (USD) ACC"},"translate_title":"英特尔刚刚被从道琼斯指数中剔除。历史告诉我们接下来会发生什么。","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"INTC":1,"GE":0.71,"NVDA":0.7,"L":0.6,"SDOW":0.6,"UDOW":0.6,"2NVD.UK":0.6,"3NVD.UK":0.6,"DDM":0.6,"DJX":0.6,"DOG":0.6,"DXD":0.6,".DJI":0.6},"content_text":"Intel will be removed from the Dow and replaced by Nvidia.\n\n\n\n\n\n\n\nOver the last decade, results have been mixed for the stocks that have been removed from the Dow.\n\n\n\n\n\n\n\nIntel's turnaround efforts will have more influence on the stock than its exit from the Dow.\n\nIntel (INTC -2.93%) stock popped Friday after it reported ugly third-quarter results but its outlook for the fourth quarter was better than expected. However, the celebration was short-lived, as S&P Global announced after hours that rival Nvidia would replace Intel in the Dow Jones Industrial Average (^DJI -0.61%).S&P Global said that the move would give a more representative exposure to the semiconductor industry as the Dow Jones is a price-weighted index and Nvidia's share price is much higher than Intel's. In fact, Intel had the lowest share price of any of the 30 Dow stocks, meaning it had the least influence on the index. The move will go into effect on Friday, Nov. 8, when the index will also swap out chemical company Dow for Sherwin-Williams for similar reasons. Intel has been a Dow component since 1999, so the move will bring its 25-year run to an end.Shares of the chip stock sold off on the news, falling 1.8% in the after-hours session. The demotion from the Dow doesn't have the same impact that removal from the S&P 500 would, as only a few ETFs track the Dow. However, it's another inauspicious sign for Intel as it attempts what's arguably the biggest turnaround effort in its history.The DJIA is updated on an as-needed basis, and its managers aim to have a balanced selection of stocks across all sectors, based on company reputation, a history of sustained growth, and interest to investors. The Dow doesn't switch components often as S&P Global aims for stability. However, as Intel gets set to be dropped, it's worth looking at how past components have fared after being removed from the Dow.The track record of Dow outcastsPrior to this announcement, the last time the Dow Jones Industrial Average reshuffled was when Amazon replaced Walgreens Boots Alliance in February. That move came as Walgreens was badly faltering, and the index sought to increase its exposure to the consumer retail sector.WBA data by YCharts.Since then, Walgreens has continued to struggle. As you can see from the chart above, the stock has fallen 55% since then, while the S&P 500 is up 13%. Based on those results, it looks like the index manager made the right call by dropping Walgreens.The last changes in the Dow before that came in 2020, when ExxonMobil, Pfizer, and RTX (formerly Raytheon) were removed from the index in favor of Salesforce, Amgen, and Honeywell. The chart below shows how they've performed since they were removed from the Dow.^SPX data by YCharts.As you can see, that batch of former Dow stocks has outperformed the broad-market index, though Exxon shares have soared, as oil stocks were down sharply as oil prices crashed during the pandemic. Before that, the last company to be removed from the Dow was General Electric, which was replaced by Walgreens in 2018. GE split into three companies, GE Healthcare, GE Aviation, and GE Vernova earlier this year, but the stock, driven by CEO Larry Culp's turnaround efforts, has been a winner since then.Finally, AT&T was the last stock in the last decade to be removed from the Dow as it was ousted in 2015. It has underperformed badly since then with a share price down 12% as the telecom market has been sluggish and it's lost market share to T-Mobile.^SPX data by YCharts.One 2017 study showed that stocks removed from the Dow initially experience decreased returns, but over the long run, they outperform stocks that have been added to the index. However, that finding might not be as reliable. What it means for IntelOver the last decade, results of stocks that have left the Dow have been mixed. Walgreens, Pfizer, and AT&T have all underperformed the market, while Exxon, RTX, and GE have beaten it.The study showing long-term outperformance for ex-Dow components should also be encouraging for Intel investors. Ultimately, the sample size of recent stocks is too small and varied to draw a clear conclusion. Intel's future depends much more on its ability to execute its turnaround in the coming quarters than it does on its removal from the Dow.Intel investors should pay attention to the company's cost-cutting initiatives, upcoming 18A foundry process, and its artificial intelligence (AI) chips that are designed to keep up with Nvidia. If the company can make a comeback, it will likely start with those key initiatives.","kind":null,"is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"-1","news_tag":"Shareholding Changes","news_rank":0,"symbols":[],"gpt_button":0},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.1","shortVersion":"4.29.1","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2481575307"}