Goldman Sachs Penny Stocks: Top 12 Stock Picks

9. Gerdau S.A. (NYSE:GGB)

Goldman Sachs’s Q1 2025 Stake: $5,704,785

Share Price as of July 3: $3.05

Number of Hedge Fund Investors In Q1 2025: 17

Gerdau S.A. (NYSE:GGB) is one of Goldman Sachs’ top penny stock picks. On June 9, UBS analysts upgraded Gerdau’s stock rating from “Neutral” to “Buy.” The decision included increasing the price target from R$17.00 to R$22.00 for shares traded on the Brazilian stock exchange and from $2.90 to $3.80 for the NYSE-listed American Depositary Receipts (ADRs).

UBS cited the U.S. decision to increase import tariffs on steel to 50% as a primary reason for the upgrade, describing it as a “significant development” for Gerdau. The analysts noted that “the U.S. raising import tariffs for steel to 50% [is] a game changer for the thesis,” emphasizing that the tariffs create tighter supply and demand dynamics in the U.S. steel market.

UBS highlighted Gerdau’s operations in North America, which contribute over 49% of the company’s core earnings as measured by adjusted EBITDA, based on Q1 2025 results. According to UBS, this significant U.S. exposure positions Gerdau to benefit from Trump’s protectionist tariff policies, as the company is less affected by import restrictions compared to its foreign competitors.

Gerdau S.A. (NYSE:GGB) is a Brazilian steel producer. It manufactures semi-finished and long-rolled steel products, including rebars, wire rods, merchant bars, and special steels used in the automotive, construction, agriculture, and energy sectors.