3 Dogs of the Dow to Buy This July

With markets closing out the first half of the year and the month of June on a high note,the S&P 500 is now up 5.7% so far in 2025. Investors may be wondering where they should position their portfolios for the second half. Indeed, the first half rewarded investors with a fairly respectable gain, and while the post-Liberation Day sell-off made for a treacherous spring, those who stayed the course did fine as the broad markets experienced one of the swiftest V-shaped bounces since the rise out of the 2020 stock market meltdown.

Indeed, we had quite the booming tech-driven rally in late 2020 and 2021, one that didn’t yet have artificial intelligence (AI) catalysts thrown into the equation. In any case, I think we could be in for continued gains in the second half as investors look forward to continued AI tailwinds (think agency and automation) while keeping tabs on mounting geopolitical risks and the state of tariffs. With the U.S. resuming trade talks with Canada just a day before Canada Day, perhaps we’ll kick off the second half of 2025 with some market-moving trade deals and the alleviation of the heightened tariff anxiety that nearly nudged stocks into a bear market back in April.

While things are looking up for many stocks, there are a few laggards that may have room to catch up. In this piece, we’ll check out the Dow Jones Industrial Average (DJIA) for a few “dogs” (or underperformers) that I think may be worth scooping up this July.

Key Points in This Article:

• These three stocks are poised for a strong second half as the market looks to continue building on recent momentum.
• Spanning tech, software and consumer discretionary, the companies are cash cows.
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Apple

Apple (NASDAQ:AAPL) stock really got left behind in the first half, finishing June down close to 16% year to date. Not quite the performance you’d come to expect from the smartphone titan, especially in the face of one of the biggest tech tailwinds (AI) in recent memory. Though shares of Apple experienced a bit of relief on the back of a report that suggested the company may be looking to power Siri with models from ChatGPT-maker OpenAI or Claude-maker Anthropic, I do think Apple stock remains one of the most undervalued Magnificent Seven (fallen) stars to pick up while it’s down.

Indeed, Apple has already made good use of ChatGPT to power features in Apple Intelligence. And as the firm looks to further its relationship or perhaps team up with another leading AI innovator, Apple will be able to pull ahead in the AI race while giving its own models more time to simmer. Indeed, it really is a win-win situation for Apple, especially as it looks to equip its developers with the AI tools needed to give its App Store a boost.

At around 32 times trailing price-to-earnings (P/E), AAPL stock looks like a hidden AI bet that, I believe, could have a far better second half.

Salesforce

Salesforce (NYSE:CRM) is another 2025 Dow dog that was down 17.5% year to date. Indeed, CEO Marc Benioff seems to be doing a good job of positioning his firm ahead of the AI agent revolution. And while the management is hyped about the AI shot in the arm it’ll get, investors still seem a bit worried about recently slowed sales growth and the recent, pricey acquisition of Informatica in a deal worth $8 billion.

If Salesforce can make the landing with its continued AI integration, I think the firm could enjoy a reinvigoration of growth. Perhaps Oppenheimer analyst Brian Schwartz put it best: the company “has a favorable data positioning for the future of AI as a core system-of-records supplier.”

Indeed, the company’s “data moat” may be wider than most investors think. And though the Informatica deal seems pricey and ill-timed, I do think it’ll pay off, perhaps in a big way once Benioff and company have the opportunity to pull the curtain on an agent that’ll change the way we all think about work.

Nike

Finally, we have Nike (NYSE:NKE), which exploded higher following its latest quarterly earnings result. Indeed, the fourth quarter didn’t just see decent sales and earnings, but management signalled that the worst may already be in the books. The company and its stock seem to be on the road to recovery.

And as Wall Street analysts hop aboard with upgrades, I wouldn’t bet against the stock as it experiences a bit of upside momentum for a change. With a still-modest 32.8 times trailing P/E multiple and wholesale partnerships already starting to pay some dividends, perhaps it’s time to load up on the Dow laggard before it makes up for its weak first half (down 3.6%) with an explosive second half for the record books. Indeed, a historic recovery for the legendary footwear maker may already be in the works.

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