In this article, we shall discuss the 5 best value stocks to buy now. To read our comprehensive analysis of the global economic outlook in 2022, go directly and see 10 Best Value Stocks to Buy Now.
5. Goldman Sachs Group Inc. (NYSE:GS)
Number of Hedge Fund Holders: 69
PE Ratio (As of September 22): 7.28
Based in New York City, Goldman Sachs (NYSE:GS) is an American multinational investment bank and financial services company which ranks 57th on the Fortune 500 list of largest U.S. corporations by revenue.
On August 27, BMO Capital analyst James Fotheringham lowered the price target on Goldman Sachs (NYSE:GS) to $461 from $475, keeping an Outperform rating on the shares. The analyst contends that although the company delivered higher expected operating and credit costs, it is necessary to consider that the company also reported an impressive, revenue-driven earnings report for Q2 2022. Fotheringham adds that in the longer term, Goldman Sachs (NYSE:GS) is projected to maintain mid-teens RoTCE, given tailwinds originating from the share gains in core IB/GM franchises. These tailwinds are also projected to improve profitability of higher-growth adjacencies and optimize funding.
Here is what GoodHaven Capital Management had to say about Goldman Sachs (NYSE:GS) in their Q2 2022 investor letter:
“Other activity in the period included eliminating our holding in PG&E and adding a few new holdings – the luxury furniture and lifestyle company RH (formerly Restoration Hardware) and The Goldman Sachs Group, Inc. (NYSE:GS). A few important developments changed at PG&E including higher future capex plans and changes in long-term guidance, and so we changed our mind and sold. Purchases were made on a handful of occasions in 2020 and mid-2021 at an approximate average price of $9.20 and fully sold during February 2022 at an approximate average price of $11.42, earning approximately 24%. We have for some time admired what RH’s unique leader Gary Friedman and his team have built at RH and what we think the future holds. After the shares declined more than 30% from the early December 2021 high, we established a position and have increased our holdings more recently. Referring to RH as a furniture company is technically accurate, but a very incomplete description of where the company is headed. Gary has a unique blend of management skills and we look forward to writing about this holding and potentially materially increasing the position opportunistically, cognizant that the coming housing market slowdown will likely negatively impact results at RH as well. We also initiated a position in Goldman Sachs at an inexpensive valuation and are attracted by the potential durability of the company’s ability to generate high returns on equity driven in part by the growth in their existing and new franchises.”
