This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

3 Stocks Added to Goldman Sachs' Favorite-Picks List

Stocks in this article: TRV RL OZM TJX BLK XL

BOSTON ( TheStreet) -- Goldman Sachs analysts shook up its so-called Conviction Buy List on Monday, adding Dow component Travelers Cos. (TRV - Get Report), apparel maker Ralph Lauren (RL - Get Report) and hedge fund Och-Ziff Capital Management (OZM - Get Report) as their best investment ideas.

To make room for Goldman's three new picks, retailer TJX Cos. (TJX - Get Report), insurance company XL Group (XL - Get Report) and asset manager BlackRock (BLK - Get Report) were bumped from the list of prime stocks.

Turning first to retail, Goldman analyst Adrianne Shapira upgraded Ralph Lauren to "buy" from "neutral," increasing the bank's 12-month price target to $190. Shapira says Ralph Lauren has many advantages, including a near-term catalyst in fiscal third-quarter earnings. Shapira also points to a long-term runway of double-digit revenue that could power earnings-per-share growth over the next five years.

"As the market digests the many ways to win at RL, we expect shares to revert back to their one-year average multiple of 20X, which drives our price target for 35% upside," Shapira writes. Of TJX, which is getting replaced by Ralph Lauren, Shapira says the company is still a share gainer but notes the stock is up nearly 33% since it was added to the Conviction Buy List. She downgraded TJX to "neutral" with a $72 price target.

Meanwhile, analyst Marc Irizarry shook up the rankings of asset managers, adding Och-Ziff to the bank's top-picks list as he expects that the firm "can generate organic growth near the top of the group (forecasting +5%) devoid of flows." Irizarry increased his price target to $11.50 from $10.50.

Meanwhile, Irizarry removed BlackRock from the bank's Conviction Buy List "based on relative upside potential but continue to view the thesis as intact." However, BlackRock still earns a "buy" rating from Goldman, and its price target was actually increased to $200 from $185 despite no longer being on the list.

Finally, Goldman analyst Michael Nannizzi recommends buying property and casualty insurance companies "on select positive pricing trends, low industry beta, and some attractive risk-adjusted dividend yields." His best pick is Travelers, which he added to Goldman's Conviction Buy List, to play on the commercial property theme. His price target on Travelers rose to $67 from $65.

On the other hand, XL Group gets bounced from the list as Nannizzi notes the company's recent hires to senior level management as well as the stock's high beta. In downgrading the stock to "neutral," Nannizzi also cut his price target for XL to $22 from $26.

-- Written by Robert Holmes in Boston.



>To contact the writer of this article, click here: Robert Holmes.

>To follow Robert Holmes on Twitter, go to http://twitter.com/RobTheStreet.

>To submit a news tip, send an email to: tips@thestreet.com.

Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,380.05 -36.80 -0.21%
S&P 500 2,016.83 -4.42 -0.22%
NASDAQ 4,698.6730 +15.2660 0.33%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs