10 Stocks Goldman Sachs Is Buying

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 |  Includes: ABX, BAC, C, DIS, EQT, GS, MAR, PM, PVH, RRC, XOM
by: Rash Menaria

The following is a list of top stock where Goldman Sachs is increasing its positions according its latest 13F filing with SEC.

Stock

Symbol

Shares Held - 06/30/2011

Shares Held - 09/30/2011

Change in shares

Citigroup Inc.

C

9,057,012

25,781,097

16,724,085

Walt Disney Co.

DIS

4,056,851

14,675,833

10,618,982

EQT Corporation

EQT

398,057

5,672,333

5,274,276

Bank of America Corporation

BAC

72,466,811

114,353,607

41,886,796

Exxon Mobil Corp.

XOM

11,779,850

15,225,383

3,445,533

Philip Morris International Inc.

PM

5,101,033

8,831,294

3,730,261

Marriott International Inc.

MAR

3,550,118

12,058,845

8,508,727

Barrick Gold Corporation

ABX

2,987,921

7,728,979

4,741,058

Range Resources Corporation

RRC

290,171

3,965,700

3,675,529

Phillips-Van Heusen Corp.

PVH

2,765,310

6,041,316

3,276,006

Click to enlarge

Source: 13F filing

I believe EQT Corporation is a good buy at current levels and there is a good likelihood of it outperforming going forward.

EQT Corporation is an integrated energy company conducting its business through three business segments: EQT Production, EQT Midstream and Distribution. EQT Production is a natural gas producer in the Appalachian Basin with 5.2 trillion cubic feet equivalent of proved reserves across 3.5 million acres. EQT Midstream provides gathering, transmission and storage services for the company’s produced gas and to independent third parties in the Appalachian Basin. Distribution, through its regulated natural gas distribution subsidiary, Equitable Gas Company, LLC distributes and sells natural gas to residential, commercial and industrial customers in southwestern Pennsylvania, West Virginia and eastern Kentucky, operates a small gathering system in Pennsylvania and provides off-system sales activities, which include the purchase and delivery of gas to customers.

EQT’s EPS forecast for the current year is $2.23 and next year is $2.78. According to consensus estimates, its top line is expected to grow 26.70% in the current year and 22.40% next year. It is trading at a forward P/E of 21.90. Out of 17 analysts covering the company, 13 are positive and have buy ratings, one has a sell rating and three have hold ratings.

EQT recently restated its intention to raise capital through either a JV or an MLP of its midstream business. This is likely to provide a near term catalyst for the stock, with high quality Marcellus assets backing the fundamentals. There is a good chance that a decision on this divesture will be taken by this year end. Going forward, in the medium term, EQT shares are expected to benefit from an accelerating Marcellus growth trend, peer-leading exposure to efficiency and productivity gains, and increased performance disclosure in the W. Virginia Marcellus. Also, the company’s current FY’12 guidance of 250 Bcfe appears conservative.

Among other stocks in the Goldman’s buy list, Bank of America and Citigroup appears to be a good choice for high risk-high reward investors. On the defensive side, Philip Morris looks good with 4% dividend yield and a stable business model with decent growth rates. One stock where I don’t agree with Goldman and would instead like to go short on is Walt Disney. Although the company reported strong last quarter results, I am worried about the cuts in advertising budgets due to slowing economy. Park attendance may also be adversely affected as consumers become more cautious towards discretionary spending.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.