Goldman Sachs says These 3 stocks could surge over 30% from current levels
After true annus horribilus, we are all ready for better times. The US equity strategy team at Goldman Sachs, led by David Kostin, sees that better time ahead, and in the near term. The team is forecasting a 25% gain for the S&P 500 within the next 24 months – or to put it in absolute numbers, they believe the index will reach 4,600 by December 2022. Kostin sets out four clear reasons to believe that we are there to start another long bull run. First, it sets out the generally improving economic conditions; second, it highlights corporate earnings growth; third, are the historically low interest rates, as the Fed adheres to its almost zero rate policy; and finally, there is TINA, or ‘there is no alternative.’ Stocks are entering a virtuous cycle, Kostin believes, as they offer the highest returns available for now. In a recent interview, Goldman’s chief equity strategist said of these points, “That’s the story, it’s about an improving economy, coming off the pandemic, and improving overall, and the Fed be held back. That is all positive and I believe that the market recognizes that and will continue to do so. ”Goldman Sachs analysts are following Kostin’s lead, and highlight three stocks that they think will benefit from the general upturn in the market. We ran the trio through the TipRanks database to see what other Wall Street analysts have to say about them.ordstown Motors (RIDE) Goldman’s first choice is Lordstown Motors. This Ohio-based company, closely associated with General Motors’ standard Big 3, is a manufacturer of electric vehicles. The company works out of a former GM Lordstown, Ohio assembly plant, which it purchased last year. Lordstown has over 6.2 million square feet of production floor space, and a capacity of 600,000 vehicles per year. The company’s flagship vehicle is the all-wheel-drive Endurance lift truck. The vehicle is based on a unique design, using individual electric motors at each wheel hub. The Endurance is expected to be delivered in the fall of 2021. Founded in 2018, Lordstown Motors went public earlier this year by merging with a ‘blank check’ company. These transactions are designed to provide capital to companies wishing to enter the public market. As part of the preparations for the release of its Endurance truck, Lordstown has entered into an agreement with RV manufacturer Camping World Holdings (CWH). Camping World will train its mechanics on the new truck, and provide garage floor space to Lordstown customers. The deal includes potential for expansion, such as sharing sales, space and providing electric propulsion systems for RVs.Covering this stock for Goldman Sachs, analyst Mark Delaney writes, “We believe this collaboration is a first step to address Lordstown’s service footprint and charging infrastructure. , and we view Lordstown’s decision to leverage the footprint of an existing service as a cost-effective strategy … we believe that the wider customer experience, including service and charging, plays a significant role in product differentiation and can help new EV businesses to be successful. In our view, the ease and reliability of maintenance and charging is particularly important for Lordstown’s commercial fleet / customer base, which focuses on vehicle upgrades. ”In line with these comments, Delaney RIDE shares a Buy plus a $ 31 target price for the next 12 months. At current levels, this implies a 67% upside potential. (To watch Delaney’s history, click here) Overall, RIDE shares receive Holding from the analyst consensus, reflecting Wall Street’s caution toward a new – and highly speculative – effort. The rating is from 4 recent reviews, split evenly between 2 Buy and 2 Cell. However, the average price target of $ 27.50 suggests that RIDE has a 48% upside for the coming year. (See RIDE stock analysis on TipRanks) Liberty Global (LBTYA) Next up is Liberty Global, a holding company in the telecommunications sector. Liberty has a global presence with operations in seven European countries: the UK, the Netherlands, Ireland, Belgium, Poland, Slovakia, and Switzerland. The company has annual revenues of more than $ 11 billion. Through its subsidiaries, Liberty serves over 11 million customers with a combined 25 million subscriptions to internet, television and telephone broadband services. The company also claims 6 million mobile and wifi subscribers. Liberty is a leading investor in European digital and online infrastructure projects. One recent move by the company was the acquisition of Swiss telecom provider Sunrise Communications last month. Upon completion of the transactions, Liberty Global now owns over 98% of Sunrise’s total share capital, making the Swiss company a wholly-owned subsidiary of Liberty Global Group.Goldman Sachs analyst Andrew Lee, in an extensive review of Liberty’s current business and market position, highlighting the Swiss acquisition as a key factor for the company’s future. He writes, “We regard Sunrise as a quality asset, with continuing potential to grow market share. We expect this to directly benefit LBTYA as Sunrise continues to gain a stake from Swisscom but also help stabilize UPC’s asset. ”Lee gives LBTYA shares a Buy rating and a $ 33. price target. This figure suggests a ~ 36% year-over-year upturn from current levels. (To watch Lee’s story, click here) Like RIDE above, Liberty has an equal split among its recent reviews – in this case, 3 Buy and 2 Holdings, making the analyst’s consensus opinion a Moderate Buy. The share price is $ 24.32, and the $ 30.12 average price target indicates room for ~ 24% growth from that level. (See LBTYA stock analysis on TipRanks) Lufax Holding (LU) Fintech is a fast-growing niche, and Lufax operates a personal financial services platform serving the Chinese market. The company provides wealth management for the rapidly growing middle class in China, a population that is not only growing in size but also in wealth. Lufax offers financing solutions for personal and business loans to this population, which is not always well served by China’s established banking sector. The company’s customer base includes small business owners and employees. Revenue for the third quarter, reported earlier this month, came in at $ 2 billion in US currency. The EPS of 24 cents beat the estimates by 10 cents, or 71%. These numbers were down year-on-year, though. The key uncertainty currently facing Lufax is state regulation. The Chinese government, while allowing a market-based economy, generally retains a tight grip on economic activity, and modern, forward-thinking companies like Lufax can run afoul of regulators who are sometimes uncomfortable with the world digital. The prospect of tighter regulation, as government officials try to impose controls on fintech, has some investors worried. After an extensive review of the Chinese technology regulatory environment, Elsie Cheng of Goldman, dealing with Lufax, noted: “We continue to be constructive on Lufax’s ability to navigate the ever evolving regulatory environment and delivery constant value added for its users / financial partners. ”In light of that, Cheng rates LU and Buy alongside a $ 20 price target, which suggests 34% upside for the coming year. (To view Cheng’s history, click here) Overall, the Buy on Lufax-based analyst’s consensus rating is based on 7 reviews, including 4 Buy and 3 Holdings. The $ 17.70 average price target indicates a potential upside of 15% next year. (See LU stock analysis on TipRanks) To find good ideas for stocks trading at attractive valuations, visit TipRanks Best Stocks to Buy, a newly launched tool that unites all TipRanks.Disclaimer equity insights: The views expressed in this article are solely those of the analysts concerned. The content is intended for informational use only. It is very important to do your own analysis before making any investment.