The company’s basket includes 50 names in the Russell 1000 with the most stable earnings before interest, taxes, depreciation, and amortization (EBITDA) growth over the past 10 years.
Investor concerns about a potential recession have contributed to a global market sell-off, but Goldman Sachs sees an opportunity to weather a hypothetical economic slowdown.
In the face of these concerns, Goldman Sachs has a stable basket of growth stocks that could provide a measure of safety amid fears of a U.S. economic slowdown. These stocks may also be well-positioned to thrive as economic policy becomes uncertain.
“Investor attention will soon shift to the 2024 U.S. presidential election, which is just three months away,” wrote David Kostin, Goldman’s chief U.S. equity strategist. "Growth stocks have historically outperformed when economic policy uncertainty increases."
The company’s basket includes 50 names in the Russell 1000 with the most consistent earnings before interest, taxes, depreciation, and amortization (EBITDA) growth over the past 10 years.
Here are some of the names that made the selection:
| TICKER | COMPANY NAME | VARIABILITY OF EBITDA GROWTH (10 YEARS) |
| SIRI | Sirius XM | 7 |
| DPZ | Domino’s Pizza | 7 |
| PEP | PepsiCo | 6 |
| CL | Colgate-Palmolive Co | 6 |
| MSCI | MSCI Inc. | 8 |
| ZTS | Zoetis | 9 |
| WM | Waste Management | 6 |
| CSCO | Cisco Systems | 10 |
| IBM | International Business Machines | 15 |
| FFIV | F5 | 16 |
Of the various sectors on the list, information technology has the most names with 14 companies, and only five of them have posted gains this year. Tech giant International Business Machines and cloud security company F5 are two of them, with shares up more than 14% and around 5%, respectively, in 2024.
Over the past month, IBM is up about 6% and F5 is up more than 9% after both companies reported second-quarter earnings that beat Wall Street expectations. The names also have a 10-year EBITDA growth variance that is on the high end of the group, with IBM at 15% and F5 at 16%.
However, where they diverge is in their full-year consensus growth estimates. Specifically, Goldman notes that F5 has a consensus EPS growth estimate of 12% in 2024, while IBM has a 5% EPS growth estimate.
In the consumer discretionary sector, Domino’s Pizza is included on the list. The stock has a 10-year EBITDA growth variability of 7 percentage points. Domino’s also has full-year consensus EPS growth estimates of 10% and 7% revenue. The company’s shares are up about 4% in 2024.
Shares of communications services Sirius XM and healthcare Zoetis — two other names on the list — haven’t fared as well this year. While Zoetis is down more than 6% in 2024, Sirius XM has seen even more severe losses, with shares down nearly 44% for the year.
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The information and considerations contained in this article should not be used as the sole or primary basis for making investment decisions. The reader retains full freedom in his or her investment choices and full responsibility in making them, since only he or she knows his or her risk appetite and time horizon. The information contained in the article is provided for information purposes only and its disclosure does not constitute and should not be considered an offer or solicitation to the public to save.|
Original article published on Money.it Italy 2024-09-11 07:10:00. Original title: Mercati turbolenti? Ecco le azioni da comprare secondo Goldman Sachs
