Goldman Sachs has just released a report that highlights exactly the kind of stocks you want to be thinking about right now.
These are ‘high quality’ stocks specially selected by the firm. And by ‘high-quality’ Goldman Sachs means stocks that meet the following 5 factors: strong balance sheets, stable sales growth, low deviation in operating income, low stock drawdown risk, and return-on-equity that exceeds peers. In other words, these stocks are the best-positioned to 1) withstand an economic slowdown; and 2) diminishing equity returns.
On top of that we used TipRanks‘ stock data to find out what other top analysts have to say on these stocks. That way we can highlight stocks with the most bullish Street consensus from Goldman Sachs’ list.
Let’s take a closer look at these top stock picks for 2019 now. Here we cover the second 4 stock picks, for the first 4 click here.
1. Visa Inc (V)
This financial stock continues to outperform. Year-to-date, Visa (V– Research Report) shares have surged over 20%.
And looking forward to 2019, there’s no reason why Visa’s outperformance can’t continue.
Indeed, top-rated Cantor Fitzgerald analyst Joseph Foresi (Track Record & Ratings) has just reiterated his V Buy rating. This comes with a bullish $160 price target — 15% upside potential.
“Strong growth continues” cheers Foresi, before writing: “We remain attracted to Visa’s dominant position in the global card network market and to its strong, recognizable international brand.”
Notably, Foresi highlighted Visa’s opportunity to capitalize on the global conversion of cash into credit, international opportunities, and digital payment tailwinds.
Meanwhile Visa Direct, contactless payments, and B2B all have the potential to drive share prices higher.
Out of 16 top analysts polled on this ‘Strong Buy’ stock, 15 are bullish. This is with a $167 average analyst price target.
2. Booking Holdings Inc (BKNG)
If you’re planning a holiday right now, chances are high you’ll turn to Booking Holdings (BKNG– Research Report). From a small Dutch startup, BKNG is now one of the world’s largest travel e-commerce companies. It holds Booking.com, Priceline.com, Kayak.com, Cheapflights, OpenTable and more.
From a Street perspective, what stands out is a recent upgrade from Wells Fargo’s Robert Coolbrith (Track Record & Ratings). Analysts usually reiterate their stock ratings — so when a stock is upgraded to Buy that definitely tells us something.
Plus Coolbrith simultaneously ramped up his price target from $2,150 to $2,200. From current levels, this means we are now looking at upside of close to 18%.
In this case Coolbrith cites the company’s Q3 performance and Q4 guide as well as management’s 2019 long-term strategy. This breaks down to: 1) platform investment, 2) above-market top-line growth and 3) a close focus on EBITDA dollar growth.
And crucially, even though shares are over $1,800, Coolbrith sees an appealing entry point right now. Shares are currently trading down over 5% in the last three months. “We note that shares remain significantly below historical valuation averages — BKNG’s current NTM EV/EBITDA is 12% below its 3-year median.”
Overall, BKNG stock earns a Moderate Buy analyst consensus. This comes with a $2,242 average price target — which means 23% upside potential lies ahead. See what other Top Analysts are saying about BKNG.
3. Dollar Tree Inc (DLTR)
When trading is rough, defensive stocks tend to do well. And bargain retail store Dollar Tree (DLTR– Research Report) is a perfect example of a defensive stock. Everything in the store sells for $1 or less.
On October 16, the NY Post reported that Carl Icahn is accumulating a stake in Dollar Tree. Apparently, we are looking at a ‘significant’ stake. On the news, DLTR stock jumped 6.8%. Icahn is an activist investor, known for pushing for changes at the company leadership level.
Five-star Oppenheimer analyst Rupesh Parikh (Track Record & Ratings) has an Outperform rating on the discount giant. He writes: “We continue to see meaningful optionality with the DLTR story from either an improving fundamental longer-term outlook or optionality with the Family Dollar asset.”
Encouragingly, he believes the stock is trading at attractive levels. This is in part down to the market undervaluing American variety store chain Family Dollar.
“At a low $80s stock price, the implied Family Dollar valuation is just a low single-digit EBITDA multiple” points out Parikh. And as for Icahn joining the team, he gives this reaction: “We await more details on Icahn’s stake and the proposed actions that could potentially unlock shareholder value from here.”
With a Moderate Buy consensus, the stock’s $94.18 average analyst price target works out at 15% upside potential from current levels. See what other Top Analysts are saying about DLTR.
4. Biogen Inc (BIIB)
Biogen (BIIB– Research Report) has a dominant position in neuroscience. The company has a leading portfolio of medicines to treat multiple sclerosis (MS) as well as the only FDA-approved treatment for spinal muscular atrophy (SMA).
To top it off, Biogen also boasts an extensive pipeline of new medicines in development. This includes Aducanumab for Alzheimer’s disease. It is estimated that over 25 million individuals are living with AD worldwide.
The memory loss and functional decline of Alzheimer’s disease have been linked to amyloid plaques, abnormal protein deposits that build up in the brain. Aducanumab is an antibody that binds to and may reduce amyloid plaques from the brain, potentially slowing the progress of the disease.
“We believe Biogen shares are undervalued based on our view that the company’s leadership position in neuroscience should deliver long-term growth. A business supporting high-risk, high reward studies puts BIIB in the lead to develop a potentially disease-modifying AD drug,” states Oppenheimer’s Jay Olson (Track Record & Ratings).
He has a buy rating on the stock with a $380 price target. According to Olson, BIIB has achieved a critical mass in neuroscience that enables high-risk programs with sufficient cash flow to embark on high-risk programs.
Overall this ‘Moderate Buy’ stock has scored 8 buy ratings vs 3 hold ratings in the last three months. Meanwhile the $391 average analyst price target works out at over 23% upside potential.
Enjoy Research Reports on the Stocks in this Article:
Biogen Inc (BIIB) Research Report
Booking Holdings Inc (BKNG) Research Report
Dollar Tree Inc (DLTR) Research Report
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