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Goldman Cites Microsoft, Starbucks, Others for Profit Margins

Goldman Sachs published a list of 29 of its buy-rated stocks that are “unappreciated” for their growing profit margins.

Coffee, computer chips and metals companies all figure in a list of 29 "underappreciated" stocks released by Goldman Sachs Friday.

Here’s Goldman’s commentary about some of the buy-rated stocks it says are not receiving their due.

· “Alcoa  (AA) - Get Alcoa Corp. Report: Significant leverage to a positive aluminum price outlook … should result in higher earnings and free cash flow generation allowing for deleveraging and capital allocation flexibility to pursue shareholder return.

· Advanced Micro Devices  (AMD) - Get Advanced Micro Devices, Inc. Report: Market share gains in client and server central processing segments augmented by gross margin expansion and operating expenditure leverage should drive positive revisions to near-and medium-term EPS.

· Microsoft  (MSFT) - Get Microsoft Corporation (MSFT) Report: Strong presence across all layers of the cloud stack amid a backdrop of accelerating digital transformation spending should drive foreseeable double-digit top line growth and margin expansion. Price increases announced recently should help offset potential margin headwinds. …

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· Starbucks  (SBUX) - Get Starbucks Corporation Report: Tailwinds from the economic re-opening in the U.S. and abroad, along with the company’s significant scale, market share gains and operational efficiencies should drive strong multi-year earnings power. Management recently noted that cost of goods sold should not be a headwind in FY21/22 from coffee purchasing. …” 

Other names on the Goldman list include:

Applied Materials  (AMAT) - Get Applied Materials, Inc. Report, Charter Communications  (CHTR) - Get Charter Communications, Inc. Class A Report, Chemours  (CC) - Get Chemours Co. Report, Cheniere Energy  (LNG) - Get Cheniere Energy, Inc. Report, ConocoPhillips  (COP) - Get ConocoPhillips Report, Deere  (DE) - Get Deere & Company Report, Diamondback Energy  (FANG) - Get Diamondback Energy, Inc. Report, EQT  (EQT) - Get EQT Corporation Report, Exxon Mobil  (XOM) - Get Exxon Mobil Corporation Report, First Quantum Minerals FM.TO, Freeport-McMoRan  (FCX) - Get Freeport-McMoRan, Inc. (FCX) Report, Hasbro  (HAS) - Get Hasbro, Inc. (HAS) Report, Herc Holdings  (HRI) - Get Herc Holdings, Inc. Report,

In addition, it called out Johnson Controls International  (JCI) - Get Johnson Controls International plc (JCI) Report,  Ovintiv  (OVV) , PDC Energy  (PDCE) - Get PDC Energy, Inc. Report,  (CRM) - Get, inc. Report, Sherwin-Williams  (SHW) - Get Sherwin-Williams Company Report, Suncor Energy  (SU) - Get Suncor Energy Inc. Report, Trimble  (TRMB) - Get Trimble Inc. Report, United Rentals  (URI) - Get United Rentals, Inc. Report, Universal Display  (OLED) - Get Universal Display Corporation Report, Waste Connections  (WCN) - Get Waste Connections, Inc. Report, Wingstop  (WING) - Get Wingstop, Inc. Report and Wyndham Hotels & Resorts  (WH) - Get Wyndham Hotels & Resorts, Inc. Report., AMD and Microsoft are holdings in Jim Cramer's Action Alerts PLUS member club