40 stocks with the most upside right now: Goldman Sachs

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Goldman Sachs: These 40 stocks have the most upside right now as the market rally continues to defy Wall Street's expectations in the second half of the year

Investors hungry for more gains should consider 40 high-upside stocks, according to Goldman Sachs.and start reading now.But even bullish firms like Goldman Sachs agree that further upside is very limited.After an outstanding opening half for US stocks, most top investment firms are preparing for weakness in both markets and the economy in the second half of 2023.

Entering the year, Goldman Sachs was in the cautious camp. The firm set a temperate S&P 500 target of 4,000, believing that flat earnings growth would limit the market's recovery from itsexceeded nearly all expectations However, it's worth noting that nearly all of the market's first-half gains were driven by multiple expansion, wrote David Kostin, Goldman's chief US equity strategist, in a July 6 note. In fact, improved earnings expectations accounted for just 1.2 percentage points of the S&P 500's rise, the firm found. Dividends tacked on another percentage point, for a total return of about 17%.warn that the risk-reward setup for US stocks is"unattractive.

Though that bear case may sound compelling, Goldman Sachs doesn't buy into it. The firm is confident that the market's earnings multiple will hold up as earnings growth grows modestly,Goldman Sachs is one of the most bullish firms on the Street, though its S&P 500 price target indicates that the index's upside is currently limited to about 2% from where it stands today.

 

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