As one of the world's largest and most prestigious investment banking firms, Goldman Sachs (GS) has some of the most brilliant traders and analysts working for them. Goldman provides a variety of services including investment banking, investment management, and financial advisory, etc. Goldman Sachs has considerable influence and expertise, and stocks often rise or fall based on an upgrade or downgrade from this firm. When one of the most highly regarded investment banks offers some of their top stock picks for 2012, it makes sense to consider them. While all these stocks appear to be undervalued in the long-term, it makes sense to wait for short-term pullbacks in order to achieve the best results.
The J. M. Smucker Company (SJM) makes a variety of food products such as jams, peanut butter, cake mixes, coffee, shortening, and much more. The company sells under many well-known brand names such as Smucker's, Pillsbury, Carnation, Crisco, Knudsen Family, Folgers and others. Since trading around $68 in August, the stock has been climbing steadily higher, with a few dips now and then. The stock could easily drop to about $76 in a mild market correction, and that would be a solid buying opportunity as the stock seems to have support at that level. Goldman Sachs has set a $86 price target.
Here are some key points for SJM:
- Current share price: $80.38
- The 52 week range is $61.16 to $81.21
- Earnings estimates for 2011: $5.02 per share
- Earnings estimates for 2012: $5.57 per share
- Annual dividend: $1.92 per share which yields 2.4%
Williams-Sonoma, Inc. (WSM) offers premium quality kitchen and cookware goods at its stores and through catalogs and online sales. The company also owns and operates the Pottery Barn and West Elm furniture stores. The stock was trading for about $39 recently, but it dropped when the company announced that high marketing expenses would reduce earnings. The consensus estimate for the fourth quarter was $1.19 but the company lowered it to a range of $1.10 to $1.15. The recent drop in the stock looks like a solid buying opportunity. Goldman has set a $44 price target for Williams-Sonoma shares.
Here are some key points for WSM:
- Current share price: $34.97
- The 52 week range is $27.90 to $45.48
- Earnings estimates for 2011: $2.20 per share
- Earnings estimates for 2012: $2.46 per share
- Annual dividend: 68 cents per share which yields 2%
Dick's Sporting Goods, Inc. (DKS) is a leading specialty retailer of sporting goods and related products. The company operates over 500 stores, including the Golf Galaxy stores. This company offers a "superstore" type environment for just about any type of sport, including football, bicycling, running, golf, swimming, basketball, soccer, and many more. This company has a solid balance sheet and the stock appears undervalued based on steady results in a less than stellar retail environment. Earnings estimates show solid growth potential in the future. Recently, this stock has found support around the $36 level, so buying at that level looks particularly attractive. Goldman Sachs has set a $49 price target for these shares.
Here are some key points for DKS:
- Current share price: $40.77
- The 52 week range is $29.10 to $42.97
- Earnings estimates for 2011: $2.02 per share
- Earnings estimates for 2012: $2.37 per share
- Annual dividend: 50 cents per share which yields 1.2%
The Coca-Cola Company (KO) makes and distributes many types of beverages ranging from soft drinks to juice to water. The company owns well-known brands such as Sprite, Vitamin Water, Minute Maid, Dasani, and others. These products are steady sellers even in a weak global economy, so the stock is a great way to be somewhat defensive and it pays a higher than average dividend. The company also has growth potential as incomes rise in emerging market countries and more consumers demand specialty drinks. Recently, this stock has dipped somewhat in part due to issues over potentially fungicide-tainted orange juice which has caused concerns. This looks like an overblown reaction and a solid buying opportunity. Goldman Sachs sees the shares rising to $75.
Here are some key points for KO:
- Current share price: $68.09
- The 52 week range is $61.29 to $71.77
- Earnings estimates for 2011: $3.82 per share
- Earnings estimates for 2012: $4.10 per share
- Annual dividend: $1.88 per share which yields 2.8%
Nike, Inc. (NKE) is a leading designer and manufacturer of athletic footwear and apparel. Nike is one of the most valuable and recognizable brands worldwide. This company is seeing continued high demand for its products even with a weak and uncertain global economy. Nike is likely to see growth from emerging market countries as disposable incomes and demand for higher-end goods continues to rise. In October, this stock was trading for about $82, but it has been trending higher. Because of that, it makes sense to patiently wait for a better entry point at around $96 or less. Goldman Sachs has set a $108 price target for Nike shares.
Here are some key points for NKE:
- Current share price: $101.76
- The 52 week range is $69.43 to $102
- Earnings estimates for 2011: $4.93 per share
- Earnings estimates for 2012: $5.80 per share
- Annual dividend: $1.44 per share which yields about 1.4%
Comcast Corporation (CMCSA) offers a wide range of products and services including cable, high-speed Internet, telecommunications, cable network programs and more. The company also owns and operates Universal Pictures and Universal Studios theme park in Hollywood. Comcast is the majority owner of NBC Universal, which operates CNBC. This stock was trading around $21 in November, and has been trending higher. It looks like it has strong support around $23, so I would wait for pullbacks to that level. Goldman Sachs has set a $35 price target for Comcast shares.
Here are some key points for CMCSA:
- Current share price: $26.07
- The 52 week range is $19.19 to $27.16
- Earnings estimates for 2011: $1.51 per share
- Earnings estimates for 2012: $1.86 per share
- Annual dividend: 45 cents per share which yields about 1.7%
Data is sourced from Yahoo Finance.
Disclaimer: No guarantees or representations are made. Hawkinvest is not a registered investment advisor and does not provide specific investment advice. The information is for informational purposes only. You should always consult a financial advisor.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.