Five stocks that are set to rally, according to Goldman Sachs
Goldman Sachs this week named several stocks that analysts at the investment bank say have more room to run. The Wall Street firm says these companies are resilient and that investors should quickly buy them. CNBC Pro combed through Goldman Sachs research to find five buy-rated stocks that it says have more upside. They include: Apple, MasTec, BJ’s, Valvoline and Kontoor Brands. MasTec The infrastructure and renewables infrastructure company is a new buy at Goldman. Analyst Ati Modak lifted his rating on the stock to buy from neutral, citing multipl positive catalysts ahead. Mastec is expected to benefit from robust utility spending and Modak sees a high probability of upward estimate revisions as oil and gas pipeline construction ramps up. Goldman also raised its price target to $195 per share from $156. “Given the significant number of long haul pipeline announcements from midstream oil & gas companies recently, and given that MTZ is the largest market player in pipeline construction today, we now expect the Pipeline Infrastructure segment to run rate ~$2.4-2.5 bil in annual revenue over the next few years,” Mastec share are up 19% this year. Valvoline The oil change company was recently upgraded to buy from neutral by analyst abnalysts led by Mark Jordan. Goldman called Valvoline best-in-class, saying the company is well positioned no matter the macroeconomic environment. Valvoline also has limited exposure to higher tariffs, Jordan added. “With only 6% market share of the do-it-for-me oil change market, strong brand name recognition and a solid operating playbook, we see the opportunity for significant upside over the longer term, ” he wrote. Jordan also likes the company’s refranchising opportunities, which he says will add even more value in coming quarters. “We see an attractive runway for future expansion, and suggest that scale operators have a significant competitive advantage, particularly those with strong brand recognition, such as Valvoline, ” he added. The stock is up 2% this month. Kontoor Brands Goldman recently reinstated coverage of the Wrangler and Lee Jeans parent, calling the stock too attractive to ignore. “Wrangler brand momentum remains robust, and is supported by strong western trends,” analyst Brooke Roach wrote. In addition, trends for Lee are starting to stabilize, she noted. Goldman is also bullish on Kontoor’s acquisition of Helly Hansen . The outdoor clothing company has a long runway for growth, according to Roach. Meanwhile, shares of Kontoor are down 27% this year with plenty of room to recover, the Wall Street bank believes. “We see an attractive risk/reward for KTB as a result of healthy underlying trends in the base business (particularly Wrangler), significant growth optionality as the company integrates the Helly Hansen brand, and KTB’s relatively attractive positioning as a result of current tariff policy,” Roach said. Apple “We are Buy-rated on AAPL as we believe that the market’s focus on slower product revenue growth masks the strength of the AAPL ecosystem & associated revenue durability & visibility. … .Valuation is attractive relative to AAPL’s historical multiple — both on an absolute & relative basis — and compared to key tech peers.” MasTec “Upgrading MTZ to Buy for Pipeline-Driven Estimate Revisions … Given the significant number of long haul pipeline announcements from midstream oil & gas companies recently, and given that MTZ is the largest market player in pipeline construction today, we now expect the Pipeline Infrastructure segment to run rate ~$2.4-2.5 bil in annual revenue over the next few years.” Valvoline “With only 6% market share of the do-it-for-me oil change market, strong brand name recognition, and a solid operating playbook, we see the opportunity for significant upside over the longer term … [and] an attractive runway for future expansion, and suggest that scale operators have a significant competitive advantage, particularly those with strong brand recognition, such as Valvoline.” Kontoor Brands “We see an attractive risk/reward for KTB as a result of healthy underlying trends in the base business (particularly Wrangler), significant growth optionality as the company integrates the Helly Hansen brand, and KTB’s relatively attractive positioning as a result of current tariff policy. Wrangler brand momentum remains robust, and is supported by strong western trends.” BJ’s “We reiterate our Buy rating on BJ, highlighting that we continue to see earnings upside at BJ driven by a better top-line outlook based on continued strong traffic trends, unit volume growth in grocery categories, and greater customer engagement likely in general merchandise categories as a result of the company’s assortment refresh.”
