Goldman Sachs has identified three “attractive” value stocks that could see significant share price appreciation over the next 12 months. The Wall Street bank’s analysts see over 50% upside potential in British Airways parent International Consolidated Airlines Group , vehicle manufacturer CNH Industrial , and health technology company Philips . Shares of all three companies are traded across Europe and the United States. Goldman Sachs said all three companies stand out amongst their European peers for their cheap valuations compared to earnings growth prospects. “European equities do stand out on valuation, trading well below historical multiples,” said the analysts led by John Sawtell, Goldman’s co-head of European equity research. IAG The bank’s airline analyst Patrick Creuset upgraded IAG to buy in January after noting that the stock had not reacted to consensus earnings upgrades from analysts. Creuset sees “further upside to consensus” for IAG ‘s 2024 earnings and expects the stock to rally 64% from the current share price of 145 British pence. U.K. shares are generally priced in pence, with 100 pence equal to one British pound ($1.26). IAG-GB 1Y line Philips Goldman recommends buying Philips and expects the shares to be up 51% over the next 12 months. The investment bank’s analyst sees “robust margin progression” for Philips in 2024, driven by manufacturing savings and the easing of previous pricing pressures. Philips CEO Roy Jakobs told CNBC last month that the company was “pulling growth out of every single market” and looking toward introducing more artificial intelligence-powered technology within healthcare. CNH Industrials Goldman Sachs upgraded CNH to buy last month. Shares are expected to rise by 57% to $19 a share. The bank’s analyst believes the stock has oversold in expectation of a downturn in the agricultural equipment market while underestimating CNH’s potential for profit margin growth through cost cuts and pricing power. CNHI 1Y line — CNBC’s Michael Bloom contributed reporting.
Goldman names 3 ‘attractive’ value stocks that offer more than 50% upside
Feb 13, 2024
