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Goldman's Top 25 Tactical Trades For Earnings Season

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Goldman's Top 25 Tactical Trades For Earnings Season
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In a recent report, analysts as Goldman Sachs gave their outlook for Q1 earnings season. The report included an overview of what investors can expect and listed Goldman’s top 25 trading ideas.

“Better Than Feared” Rally?

Analysts believe that stocks could benefit from extremely low expectations for Q1 earnings.

The earnings environment in Q1 was far from ideal for much of the market, as a strong U.S. dollar weighed on exporters, low oil prices hurt much of the energy sector and historically low interest rates continue to make things difficult for financials.

Related Link: 30 Cybersecurity Stocks In A Dangerous Digital World

Q2 Recovery

Analysts are predicting that the sluggish Q1 has laid the groundwork for a bounce-back Q2. They believe that higher consumer confidence, lower earnings expectations and a sales recovery following the harsh winter could contribute positively to Q2 numbers.

In addition, lower volatility in oil and forex could reduce unpredictability and worry.

Top Earnings Plays

Goldman analysts see the most Q1 earnings upside for the following stocks:

  • Mead Johnson Nutrition Co (NYSE: MJN)
  • The TJX Companies Inc (NYSE: TJX)  
  • Wyndham Worldwide Corp (NYSE: WYN)  
  • Pioneer Natural Resources Co (NYSE: PXD)  
  • Valero Energy Corp (NYSE: VLO)  
  • Ameriprise Financial Inc (NYSE: AMP)  
  • Lazard Ltd (NYSE: LAZ)  
  • HCA Holdings Inc (NYSE: HCA)  
  • Hologic Inc (NASDAQ: HOLX)  
  • Laboratory Corp. of America Holdings (NYSE: LH)  
  • Barrick Gold Corp (NYSE: ABX)  
  • Apple Inc. (NASDAQ: AAPL)  
  • Amazon.com Inc (NASDAQ: AMZN)  
  • Demandware Inc (NYSE: DWRE)  
  • Infinera Corp (NASDAQ: INFN)  
  • Juniper Networks Inc (NYSE: JNPR)  
  • LinkedIn Corp (NYSE: LNKD)  
  • Lam Research Corp (NASDAQ: LRCX)

Goldman analysts see the most Q1 earnings downside for these names:

  • Cabela’s Inc (NYSE: CAB)  
  • Coach Inc (NYSE: COH)  
  • EverBank Financial Corp (NYSE: EVER)  
  • Deere & Co (NYSE: DE)  
  • Kennametal Inc (NYSE: KMT)  
  • Microsoft Corporation (NASDAQ: MSFT)  
  • FirstEnergy Corp (NYSE: FE)

Disclosure: the author holds a short position in Amazon.

Latest Ratings for MJN

DateFirmActionFromTo
Apr 2017Wells FargoDowngradesOutperformMarket Perform
Mar 2017Credit SuisseDowngradesOutperformNeutral
Feb 2017BMO CapitalDowngradesOutperformMarket Perform

View More Analyst Ratings for MJN
View the Latest Analyst Ratings

Posted-In: earnings trades Goldman SachsAnalyst Color Long Ideas Short Ideas Analyst Ratings Trading Ideas Best of Benzinga

 

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