Investing

Goldman Sachs Raises Price Targets on 4 Top Stocks to Buy

With just a week left in the second quarter, and most of the first-quarter results long since posted, now come the big questions concerning second-quarter performance. While many investors remain very nervous, especially given the massive rally off the March market lows, the overall take is one of slow but steady growth going forward, given the incredible turmoil in the equity markets and the economy due to the pandemic and social unrest.

In a series of new reports, Goldman Sachs raises the price targets on shares of some companies that delivered the goods in a big way. Given these increases, the stocks look to have some very solid upside potential. Here we spotlight four stocks rated Buy for which the analysts have raised the price targets.

Etsy

This company posted outstanding first-quarter results. Etsy Inc. (NASDAQ: ETSY) operates two-sided online marketplaces that connect millions of passionate and creative buyers and sellers around the world. The company’s primary marketplace, Etsy.com, is the global destination for unique and creative goods. Buyers come to Etsy to be inspired and delighted by items that are crafted and curated by creative entrepreneurs.

For sellers, Etsy offers a range of tools and services that address key business needs. In addition, the company owns Reverb, a leading global online marketplace dedicated to buying and selling new, used, and vintage musical instruments.

On the back of the solid first quarter, the second-quarter earnings estimate has been raised by a penny to $0.36 per share. The 2020 estimate has been raised to $0.91 per share and the 2021 estimate has increased to $1.28 per share.

The Goldman Sachs price target was raised to $120 from $88. The Wall Street consensus target was last seen at $84.41 but is sure rise as other firms hike their targets as well. Etsy stock closed Tuesday’s trading at $101.22, up over 5% on the day.

Masco

This lesser known stock has very solid growth potential. Masco Corp. (NYSE: MAS) is a leading building products company, manufacturing and selling paints, faucets, showerheads and other plumbing, cabinets, windows and other hardware products. Approximately 85% of sales are attributable to residential repair and remodel activity, with the remaining 15% from new residential construction.

The company’s portfolio of industry-leading brands includes Behr paint; Delta and Hansgrohe faucets, bath and shower fixtures; KraftMaid and Merillat cabinets; Milgard windows and doors; Kichler decorative and outdoor lighting; and HotSpring spas.

Investors receive a 1.10% dividend. The $48 Goldman Sachs price target was raised to $54, essentially in line with the $53.93 consensus target. Masco stock closed at $49.10 a share on Tuesday.

Mohawk Industries

This company has benefited over the past couple of years from the strong housing market. Mohawk Industries Inc. (NYSE: MHK) is a leading building products company, manufacturing and selling flooring products such as carpets, rugs, ceramic tile, wood, stone, luxury vinyl tile and vinyl flooring. The company believes it is the world’s largest flooring company, with operations in 10 countries.

The company sells flooring products under the Aladdin, Columbia Flooring, Durkan, Horizon, IVC, Karastan, Mohawk, Pergo, Portico, QuickStep and SmartStrand brands. The Flooring ROW segment provides laminate and hardwood flooring, as well as roofing elements, insulation boards, medium-density fiberboards, chipboards and vinyl flooring products under the IVC, Moduleo, Pergo, Quick-Step and Unilin brands, and it licenses patents related to flooring manufacturers.

Goldman Sachs lifted the price target to $112 from $97. The consensus target is $96.53, but Mohawk Industries stock jumped 12.6% on Tuesday to close at $103.88.

Whirlpool

The potential increase in new home sales is a big positive for this company. Whirlpool Corp. (NYSE: WHR) manufactures and markets home appliances and related products. Its principal products include refrigerators, freezers, ice makers and refrigerator water filters; laundry appliances and related laundry accessories; cooking and other small domestic appliances; and dishwasher appliances and related accessories, as well as mixers.

Whirlpool markets and distributes its products primarily under the Whirlpool, Maytag, KitchenAid, JennAir, Amana, Roper, Admiral, Affresh, Gladiator, Speed Queen, Hotpoint, Bauknecht, Indesit, Ignis, Laden, Privileg, KIC, Consul, Brastemp, Acros, Ariston, Diqua and Royalstar brands.

Whirlpool stockholders receive a 3.76% dividend. Goldman Sachs raised its $133 price objective to $150, well above the consensus target price of $119. The last trade on Tuesday hit the tape at $127.53 a share.

These four top companies are executing well and their stocks look to have very solid upside to the revised Goldman Sachs price targets. The stocks are better suited for investors with a somewhat higher risk tolerance, as they could be a touch more volatile, given the solid runs they have all made.