GOLDMAN SACHS: Buy these 15 stocks set to deliver the strongest possible profit growth and subsequent returns through year-end

  • The pandemic and recession crushed company earnings in 2020, and Goldman Sachs says S&P 500 profits will fall 21% compared to 2019.
  • In spite of those dismal numbers, Chief US Equity Strategist David Kostin says a few companies are on track to post powerful growth for the year.
  • With earnings season just a few days away, those stocks could be positioned for a strong end to 2020 and a fast start to the new year. 
  • Visit Business Insider's homepage for more stories.

Company profits were demolished in 2020, just like so many other things. But if the big picture looks bleak, things don't seem quite as bad if you know where to look.

In a year where expectations were already upended by a pandemic and a furious market recovery, with a potential Election Month capping a campaign that's already historically uncertain, earnings could give investors an important edge for the rest of the year.

Wall Street sees  a powerful earnings rebound as a sure thing — if sure things still exist — and many experts think it will give stocks an important boost from this point forward. With that in mind, Goldman Sachs Chief US Equity Strategist David Kostin is giving investors some pointers on the stocks that are on track for the most growth today.

Kostin's team is projecting a 21% drop in S&P 500 profits this year, and they say these companies are among the few that will finish the year with earnings growth of more than 20%.

The list that follows has Kostin's projected top growers for the year. It's drawn from the largest 100 companies on the S&P 500 index and excludes utilities, financials, and real estate investment trusts. They're ranked from lowest to highest based on their expected earnings growth.

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15. Adobe

Ticker: ADBE

Sector: Information technology

Market cap: $237.2 billion

2019 EPS growth: 13%

Estimated growth in 2020: 27%

Source: Goldman Sachs

14. Thermo Fisher Scientific

Ticker: TMO

Sector: Healthcare

Market cap: $179.4 billion

2019 EPS growth: 11%

Estimated growth in 2020: 27%

Source: Goldman Sachs

13. Bristol-Myers Squibb

Ticker: BMY

Sector: Healthcare

Market cap: $136.5 billion

2019 EPS growth: 69%

Estimated growth in 2020: 29%

Source: Goldman Sachs

12. Prologis

Ticker: PLD

Sector: Real estate

Market cap: $78.3 billion

2019 EPS growth: 10%

Estimated growth in 2020: 32%

Source: Goldman Sachs

11. Qualcomm

Ticker: QCOM

Sector: Information technology

Market cap: $139.2 billion

2019 EPS growth: -14%

Estimated growth in 2020: 32%

Source: Goldman Sachs

10. ServiceNow

Ticker: NOW

Sector: Information technology

Market cap: $96.1 billion

2019 EPS growth: 40%

Estimated growth in 2020: 35%

Source: Goldman Sachs

9. Amazon

Ticker: AMZN

Sector: Consumer discretionary

Market cap: $1.6 trillion

2019 EPS growth: 16%

Estimated growth in 2020: 38%

Source: Goldman Sachs

8. AbbVie

Ticker: ABBV

Sector: Healthcare

Market cap: $154.0 billion

2019 EPS growth: 11%

Estimated growth in 2020: 39%

Source: Goldman Sachs

7. Lowe's

Ticker: LOW

Sector: Consumer discretionary

Market cap: $127.6 billion

2019 EPS growth: 7%

Estimated growth in 2020: 42%

Source: Goldman Sachs

6. Activision Blizzard

Ticker: ATVI

Sector: Communication services

Market cap: $60.7 billion

2019 EPS growth: -13%

Estimated growth in 2020: 44%

Source: Goldman Sachs

5. Nvidia

Ticker: NVDA

Sector: Information technology

Market cap:

2019 EPS growth: -12%

Estimated growth in 2020: 50%

Source: Goldman Sachs

4. Netflix

Ticker: NFLX

Sector: Communication services

Market cap: $236.4 billion

2019 EPS growth: 55%

Estimated growth in 2020: 51%

Source: Goldman Sachs

3. Charter Communications

Ticker: CHTR

Sector: Communication services

Market cap: $128.1 billion

2019 EPS growth: 57%

Estimated growth in 2020: 61%

Source: Goldman Sachs

2. Advanced Micro Devices

Ticker: AMD

Sector: Information technology

Market cap: $102.0 billion

2019 EPS growth: 55%

Estimated growth in 2020: 80%

Source: Goldman Sachs

1. Vertex Pharmaceuticals

Ticker: VRTX

Sector: Healthcare

Market cap: $69.4 billion

2019 EPS growth: 31%

Estimated growth in 2020: 85%

Source: Goldman Sachs

Get the latest Goldman Sachs stock price here.

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