5 Goldman Sachs Conviction Buy Stocks With the Most Upside


Shares of this very off-the-radar company have sizable upside potential, and its products are very well known. Edgewell Personal Care Co. (NYSE: EPC) is a leading pure-play consumer products company with an attractive, diversified portfolio of established brand names. They include Schick and Wilkinson Sword men’s and women’s shaving systems and disposable razors; Edge and Skintimate shave preparations; Playtex, Stayfree, Carefree and o.b. feminine care products; Banana Boat, Hawaiian Tropic, Bulldog and Jack Black sun and skin care products; and Wet Ones moist wipes.

Edgewell has a broad global footprint and operates in more than 50 markets, including the United States, Canada, Mexico, Germany Japan, the United Kingdom and Australia. This is the kind of company that investors nervous about the economy can feel good about buying shares of now.

The $56 Goldman Sachs price objective is well above the $36.20 consensus target price. Based on a Friday close of $29.41, investors would reap a massive 85% gain if the shares traded to the Goldman Sachs target.

Seattle Genetics

For years, this biotechnology company focused on the development and commercialization of therapeutics for the treatment of cancer has been mentioned as a potential takeover candidate. Seattle Genetics Inc. (NASDAQ: SGEN) is a commercial oncology player with a leading platform of antibody-drug-conjugate drugs targeting a range of cancer indications, and Goldman Sachs has for some time thought the shares could be attractive to a big pharmaceutical giant.

Its lead drug, Adcetris (brentuximab vedotin), is marketed for several indications, including Hodgkin lymphoma, peripheral T-cell lymphoma and anaplastic large cell lymphoma. Seattle Genetics also has a drug development platform that generates revenue from licensing and collaborations.

Goldman Sachs has set a $251 price objective. The consensus price target is $167.53, and Friday’s last trade for Seattle Genetics stock hit the tape at $168.81. Reaching the Goldman Sachs target would be a gain of over 40%.

NRG Energy

This stock has made a nice run off the lows but may hold solid upside for aggressive investors. NRG Energy Inc. (NYSE: NRG) is an integrated independent power producer that owns and operates 27 gigawatts (GW) of conventional and renewable generating capacity in the United States and serves 3 million retail customers in Texas and the Northeast.

NRG derives revenue from the sale of electricity in the wholesale and retail markets and the sale of capacity. The company also owns a 64.5% interest in NRG Yield, a publicly traded, dividend growth-oriented company that owns 5 GW of long-term contracted renewable assets.

NRG announced on Friday it is buying Centrica’s North American energy business in a $3.6 billion deal that will nearly double the number of homes and businesses NRG serves across the United States and Canada. The all-cash deal to buy Direct Energy gives NRG 3 million more retail customers and is expected to generate about $740 million in annual adjusted earnings before interest, taxes, depreciation and amortization.

Investors receive a 3.51% dividend. The Goldman Sachs price target is $47. The consensus target is $43.18, and NRG Energy stock closed at $34.19 on Friday. Trading to the target would be a strong 40% or so gain.

These five top stocks across different sectors offer tremendous upside to the Goldman Sachs price objectives. While there is no guarantee they get there, moving just halfway to the targets would be outsized gains for investors.