Goldman Sachs announces 3 global stocks on its confidence list, with upside potential of more than 40% | Wilnesh News
Goldman Sachs has updated its list of the world’s best stock picks for December, adding some stocks and deleting some. The stocks appear on the investment bank’s “Conviction List – Director’s Picks,” a “curated and active” list of Buy-rated stocks. Goldman Sachs said they were selected by a subcommittee in each region that “works with analysts in each industry to identify the best ideas that combine conviction, differentiated views and high risk-adjusted returns.” Companies removed from this month’s list include New Zealand-based software company Xero and Asia-Pacific equipment maker Lenovo, as well as French industrial gases supplier Air Liquide and outdoor advertiser JCDecaux in Europe. Several stocks have also been added to the Directors’ Picks, including the following three stocks that Goldman Sachs believes have upside potential of more than 40% over the next 12 months. Novonesis Novonesis, a Danish biotech company known for industrial enzymes, microorganisms, and biopharmaceutical ingredients, is one such stock. “Several structural demand tailwinds (such as a focus on sustainability, health and wellness), coupled with Novonesis’ leading market share in enzymes and cultures, product portfolio breadth and significantly higher R&D spending than peers, support a superior position Fundamental outlook,” the investment bank said in a Dec. 2 report on its European roster. Goldman Sachs analyst Georgina Fraser said the company, also known as Novozymes, currently trades at 24 times expected 2026 earnings, a discount to peers’ 25 times. Looking forward, she expects its “organic sales growth” to double and earnings per share to grow 25%, thanks to levers such as “replacing traditional petrochemicals with bio-based alternatives”, market expansion and “applications in high-growth areas” ”. Novonesis’ shares are listed on Nasdaq Copenhagen, Denmark, and trade in the United States as American Depositary Receipts (ADRs) under the symbol NVZMY. Goldman Sachs has a price target of 586 Danish kroner ($82) on the stock, implying an upside of about 42%. Kawasaki Heavy Industries In Asia, Japan’s Kawasaki Heavy Industries, which makes motorcycles, aerospace and defense equipment, made Goldman Sachs’ list. “Kawasaki Heavy Industries is one of Japan’s top three heavy industry companies in terms of revenue, and its aerospace/defense business contributes as much to profit growth as peers Mitsubishi Heavy Industries and IHI Corporation,” the investment bank wrote in a Dec. 2 Asia report. Quite. Analyst Yuichiro Isayama noted that Kawasaki Heavy’s share price has underperformed these two peers by 80% to 100% year-to-date, and he “believes the company’s valuation is undervalued given its high exposure to the aerospace/defense sector.” A significant reduction is an attractive opportunity. “Looking ahead, Isayama expects “strong prospects for stable absolute profit growth and margin expansion in the aerospace systems and defense business, including the energy solutions and marine engineering businesses, based on the Japanese government’s new defense guidelines. KHI’s shares are listed on the Tokyo Stock Exchange and in the United States as American Depositary Receipts under the ticker KWHIY. Goldman Sachs has a price target of 8,000 yen ($53) for the stock, implying an upside of about 43.2%. Goldman Sachs is also bullish on Chinese oil and gas giant PetroChina. The stock has a price target of HK$8.1 ($1.04), which the investment bank analyst Nikhil Bhandari calls ” “Undervalued Gas Story”, arguing that “given its significant exposure to upstream gas production, it will benefit from another year of strong cash flow”. “With the increase in natural gas production (natural gas may reach about 50% of CNPC’s 2025 upstream production mix), the share of upstream natural gas revenue in 2025 E&P (exploration and production) segment revenue may be higher than that of oil, strengthening CNPC’s targeting Earnings elasticity of changes in global oil prices. Looking ahead, Bhandari expects PetroChina’s free cash flow yield to reach about 15% and its dividend yield to reach 8%. It is also in the Jinrui S&P Pan Asia Dividend Aristocrats Index ETF. (weight 6.4%) and the Matthews China Active ETF (weight 3.3%). — CNBC’s Michael Bloom contributed to this report.
