- The pandemic and recession crushed company earnings in 2020, and Goldman Sachs says S&P 500 profits will fall 21% compared to 2019.
- In spite of those dismal numbers, Chief US Equity Strategist David Kostin says a few companies are on track to post powerful growth for the year.
- With earnings season just a few days away, those stocks could be positioned for a strong end to 2020 and a fast start to the new year.
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Company profits were demolished in 2020, just like so many other things. But if the big picture looks bleak, things don’t seem quite as bad if you know where to look.
In a year where expectations were already upended by a pandemic and a furious market recovery, with a potential Election Month capping a campaign that’s already historically uncertain, earnings could give investors an important edge for the rest of the year.
Wall Street sees a powerful earnings rebound as a sure thing — if sure things still exist — and many experts think it will give stocks an important boost from this point forward. With that in mind, Goldman Sachs Chief US Equity Strategist David Kostin is giving investors some pointers on the stocks that are on track for the most growth today.
Kostin’s team is projecting a 21% drop in S&P 500 profits this year, and they say these companies are among the few that will finish the year with earnings growth of more than 20%.
The list that follows has Kostin’s projected top growers for the year. It’s drawn from the largest 100 companies on the S&P 500 index and excludes utilities, financials, and real estate investment trusts. They’re ranked from lowest to highest based on their expected earnings growth.