14 Cheap Stocks to Buy Now From Goldman Sachs

Value stocks are in demand and becoming scarce again, according to Goldman Sachs.

"Today not a single sector screens as being both cheap and under-earning," Goldman said in an April 1 note to clients. "Thus, such a top-down perspective may suggest a lack of 'value' to be found in today's market, but delving down one layer deeper we do find single-stock opportunities with 13% of our coverage fitting these criteria."

The majority of stocks that Goldman covers have currently been trading above valuations seen at the midpoint of the most recent economic cycle (defined as beginning in 2007 through today), according to the note. And while the market selloff in the back half of 2015 dampened valuations, the market recovery over the past two months has fueled another reversal of valuations, moving them higher -- and, essentially, making stocks that were once cheap more expensive again. 

At the same time, operating margins are near peak levels across the majority of stocks, with estimates suggesting that they will move even higher over the next year, the analysts wrote. (Goldman analysts are actually skeptical of operating margin trends, mainly because of rising labor costs, according to the note.) 

So what do these two trends mean for investors? Based on a screen that seeks out inexpensive stocks that are "incremental margin winners" and expected to have strong top-line growth in 2016 and 2017, here are 14 stocks to buy now, according to Goldman.

1. Ciena
1. Ciena

Goldman Sachs has a buy rating and a $24 target price on Ciena (CIEN) , a Hanover, Md.-based networking equipment company.

The company's current valuation (based on price-to-earnings ratio) is 12x compared with its mid-cycle median of 24.1x. Ciena is projected to have sales growth of 6% and an EBIT margin of 9% in 2016, according to Goldman.

2. Juniper Networks
2. Juniper Networks

Goldman Sachs has a buy rating and a $33 target price on Juniper Networks (JNPR) , a Sunnyvale, Calif.-based networking hardware company.

The company's current valuation (based on price-to-earnings ratio) is 11.2x compared with its mid-cycle median of 17.9x. Juniper Networks is projected to have sales growth of 4% and an EBIT margin of 24% in 2016, according to Goldman.

3. Amazon.com
3. Amazon.com

Goldman Sachs has a buy rating and a $720 target price on Amazon (AMZN) , a Seattle-based online commerce and cloud services provider. Amazon's stock is listed on Goldman's "Americas Conviction Buy List."

The company's current valuation (based on its enterprise value to EBITDA ratio) is 17.5x compared with its mid-cycle median of 23.9x. Amazon is projected to have sales growth of 24% and an EBIT margin of 5% in 2016, according to Goldman.

4. Hertz Global
4. Hertz Global

Goldman Sachs has a buy rating and a $13 target price on Hertz Global (HTZ) , an Estero, Fla.-based rental car chain.

The company's current valuation (based on its enterprise value to EBITDA ratio) is 6x compared with its mid-cycle median of 10.9x. Hertz is projected to have sales growth of 2% and an EBIT margin of 12% in 2016, according to Goldman.

5. Parexel International
5. Parexel International

Goldman Sachs has a neutral rating and a $71 target price on Parexel International (PRXL) , a Waltham, Mass.-based biopharmaceutical services company.

The company's current valuation (based on price-to-earnings ratio) is 15.8x compared with its mid-cycle median of 19.9x. Parexel is projected to have sales growth of 8% and an EBIT margin of 14% in 2016, according to Goldman.

6. VeriFone Systems
6. VeriFone Systems

Goldman Sachs has a neutral rating and a $31 target price on VeriFone Systems (PAY) , a San Jose, Calif.-based electronic payments technology and equipment company.

The company's current valuation (based on price-to-earnings ratio) is 12.5x compared with its mid-cycle median of 15.7x. VeriFone is projected to have sales growth of 7% and an EBIT margin of 7% in 2016, according to Goldman.

7. ICON
7. ICON

Goldman Sachs has a neutral rating and a $79 target price on Icon  (ICLR) , a Dublin, Ireland-based provider of outsourced health services to the pharmaceutical, biotech and medical device industries.

The company's current valuation (based on price-to-earnings ratio) is 15x compared with its mid-cycle median of 18.1x. Icon is projected to have sales growth of 8% and an EBIT margin of 19% in 2016, according to Goldman.

8. Textron
8. Textron

Goldman Sachs has a neutral rating and a $39 target price on Textron (TXT) , a Providence, R.I.-based commercial aerospace company comprised of a network of businesses including Bell Helicopter, Cessna, Beechcraft, Hawker, Jacobsen and Textron Systems, among others.

The company's current valuation (based on price-to-earnings ratio) is 12.3x compared with its mid-cycle median of 14.9x. Textron is projected to have sales growth of 6% and an EBIT margin of 10% in 2016, according to Goldman.

9. Mylan
9. Mylan

Goldman Sachs has a buy rating and a $60 target price on Mylan (MYL) , a U.K.-based pharmaceuticals company. Mylan's stock is listed on Goldman's "Americas Conviction Buy List."

The company's current valuation (based on price-to-earnings ratio) is 9.2x compared with its mid-cycle median of 11.4x. Mylan is projected to have sales growth of 17% and an EBIT margin of 22% in 2016, according to Goldman.

10. B/E Aerospace
10. B/E Aerospace

Goldman Sachs has a buy rating and a $57 target price on B/E Aerospace (BEAV) , a Wellington, Fla.-based commercial aerospace company that designs, manufactures, sells, and services cabin interior products for commercial aircraft and business jets.

The company's current valuation (based on price-to-earnings ratio) is 14x compared with its mid-cycle median of 16x. B/E Aerospace is projected to have sales growth of 2% and an EBIT margin of 19% in 2016, according to Goldman.

11. Brinker International
11. Brinker International

Goldman Sachs has a neutral rating and a $52 target price on Brinker International (EAT) , a Dallas-based owner of several restaurant chains, including Chili's Grill & Bar and Maggianos.

The company's current valuation (based on price-to-earnings ratio) is 11.8x compared with its mid-cycle median of 13.7x. Brinker International is projected to have sales growth of 3% and an EBIT margin of 11% in 2016, according to Goldman.

12. Hill-Rom
12. Hill-Rom

Goldman Sachs has a neutral rating and a $52 target price on Hill-Com (HRC) , a Chicago-based medical technology company.

The company's current valuation (based on price-to-earnings ratio) is 14.7x compared with its mid-cycle median of 16.3x. Hill-Com is projected to have sales growth of 35% and an EBIT margin of 14% in 2016, according to Goldman.

13. Hexcel
13. Hexcel

Goldman Sachs has a neutral rating and a $47 target price on Hexcel (HXL) , a Stamford, Conn.-based commercial aerospace company.

The company's current valuation (based on price-to-earnings ratio) is 16.8x compared with its mid-cycle median of 18.2x. Hexcel is projected to have sales growth of 5% and an EBIT margin of 19% in 2016, according to Goldman.

14. Wyndham Worldwide
14. Wyndham Worldwide

Goldman Sachs has a buy rating and a $84 target price on Wyndham Worldwide (WYN) , is a Parsippany, N.J.-based hospitality company.

The company's current valuation (based on price-to-earnings ratio) is 8.4x compared with its mid-cycle median of 9.6x. Wyndham Worldwide is projected to have sales growth of 5% and an EBIT margin of 20% in 2016, according to Goldman.

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