Investing

Goldman Sachs Conviction Buy List Surprises: MLP and Coal

If one brokerage firm on Wall Street can generate excitement with stocks to buy, it is Goldman Sachs. That is particularly so when the company makes changes to its Conviction Buy List. On Friday, two very unusual changes were made: a master limited partnership (MLP) and a coal company were added to the firm’s prized Conviction Buy List.

MarkWest Energy Partners L.P. (NYSE: MWE) was maintained as a Buy at Goldman Sachs, but the MLP was added to the Conviction Buy List and given a $78 price target. MarkWest closed at $70.64, has a 52-week range of $58.62 to $75.79 and has a consensus analyst target price of only $71.93. MarkWest is worth some $11.5 billion, and its distribution rate (“yield equivalent”) is listed as 5.1%.

SunCoke Energy Inc. (NYSE: SXC) is not a typical Conviction Buy List stock. The company operates as an independent producer of coke in the Americas, offering metallurgical and thermal coal for use as a raw material in the blast furnace steelmaking process. Goldman Sachs had a Buy rating but moved it up to the Conviction Buy List and assigned a $27 price target. After closing at $20.56, SunCoke has a 52-week range of $13.58 to $23.90, and the consensus price target is $25.33.

Metallurgical and thermal coal might not be as big a target in the current administration’s anti-coal push, but anything to do with coal has been a very hard sell to the investment community of late. As for risks in individual MLPs, MarkWest has diversified operations around the nation in several shale regions.

ALSO READ: Ten Cities Where Foreign Companies Create the Most Jobs

Take This Retirement Quiz To Get Matched With An Advisor Now (Sponsored)

Are you ready for retirement? Planning for retirement can be overwhelming, that’s why it could be a good idea to speak to a fiduciary financial advisor about your goals today.

Start by taking this retirement quiz right here from SmartAsset that will match you with up to 3 financial advisors that serve your area and beyond in 5 minutes. Smart Asset is now matching over 50,000 people a month.

Click here now to get started.

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.