Goldman says boost from tax cut 'behind us' so buy these companies that can grow on their own

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Stock profits will be harder to come by in 2019 as corporations will no longer get a boost from lower corporate tax rates, according to Goldman Sachs.

div > div.group > p:first-child"> David Kostin, the bank's chief U.S. equity strategist, said in a note Friday that an increase in the S&P 500's return on equity"appears unlikely" this year. Return on equity, usually abbreviated as"ROE," is a measure of profitability that is calculated by dividing net income by shareholders' equity. Kostin added the S&P 500's ROE increased by 2.37 percentage points to 18.

S&P 500 earnings grew by at least 25 percent in the first three quarters of 2018 and by more than 13 percent in the fourth quarter, FactSet data show. However, corporate taxes are expected to rise in some sectors, especially in the communications services group which includes Netflix and Disney. This could put pressure on corporate profits in 2019, Kostin said.

"The boost from lower tax rates is likely behind us," Kostin said."We recommend investors focus on companies that are best-equipped to withstand cost pressures in 2019."

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Lost me at includes Under Armour.

The boost never happened.

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