Markets have plummeted this year, but David Kostin, chief strategist at Goldman Sachs, believes stocks are still historically expensive.
Nevertheless he succeeded in highlighting some opportunities that can give a good return.
Growth rates may seem expensive, but they are modern Sale Create buying opportunities in selected growth stocks, Kostin says in a Friday note.
The chief strategist generally believes that stocks will struggle in the future. He notes that growth stocks are now “barely trading above market cap/income levels that have hit the lowest in the last 30 years.”
High interest rates and recession risks can provide headwinds in the short term, but a low valuation can provide a bargain for investors with a long enough investment horizon, Kostin says.
Kostin used several checkpoints to leave with a pack of five stocks he recommends. Stocks are taken from the Russell 1000 Index and:
- It has an estimated growth rate of 10 percent annually until 2024
- It is expected to have a net margin of 5% in 2023
- Trades are now less than 5 times the market value compared to revenue (EV/sales)
- Trading at 20% off for a 10-year average of market value versus revenue (EV/sales)
- Companies with poor balance sheets were excluded from the list using an Altman Z . score
Among the weights we find meta pads And the the alphabet. Both stocks have been hit hard this year, but according to Kostin, they may rise in the future.
Trip Advisor, Labor Day And the Reservation collectibles They also buy opportunities.
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