GOLDMAN SACHS: These 13 Stocks Will See Profits Explode Higher In 2018

best 2018 growth stocks
Earnings growth has been the single biggest driver of stock market gains since the start of the 8 1/2-year equity bull market. Earnings growth has been the undeniable backbone of the 8 1/2-year bull market. But it’s not always easy to pick out the companies that are going to be the biggest contributors.

That rings especially true as we enter 2018, as analysts forecast that GOP tax reform will boost a wide range of sectors, making it even more difficult to identify the elite crust of stocks. That’s where Goldman Sachs comes in. The firm has ranked stocks in the benchmark S&P 500 index by expected 2018 earnings-per-share (EPS) growth, providing a handy guide to the companies they see best supporting more profit-driven gains. Of course, earnings growth is just one component.

There are many other factors that are crucially important to the selection of single stocks. For example, a stretched valuation can be a major deterrent to traders seeking bargains, or stocks with huge upside. It’s all part of the grand puzzle, and Goldman’s analysis simply helps make it easier for investors to make the right decision.

The company also has a huge offshore portfolio with more than 410 million barrels of crude oil reserves in strategic geographic locations like the U.K. North Sea, Canada’s east coast and Norway. The company is focusing on core assets and is streamlining its portfolio by divesting non-core assets. Suncor has a strong presence in the upstream, midstream and downstream parts of oil supply chain. This integrated model has helped Suncor reach an industry leading position in both funds from operations and discretionary free cash flow per barrel.

Suncor Energy has consistently maintained its FFO higher than its capital and dividend requirements, providing a layer of safety for income investors. If February, Suncor raised its dividend for the 16th consecutive year when it announced a healthy 12.5% increase to its quarterly dividend. The company has successfully managed to increase dividends despite the volatility in oil prices.

Suncor plans to achieve 10% annual growth in production from 2016-2019. Dividends are expected to grow in line with production, which implies future dividend growth rate in the high-single-digit range. Brian: Suncor was previously a holding in Warren Buffett’s dividend portfolio, so the company’s outstanding long-term track record of savvy capital allocation is no surprise. For dividend growth investors seeking exposure to the energy sector, Suncor seems like one of the best-managed businesses to consider.

The main risk to be aware of is that oil sands have traditionally faced some of the highest extraction and environmental costs, which could be troublesome if global oil prices remain very low. Brookfield falls a spot to number 14 on this years list to no fault of their own. Brookfield is synonymous with quality and one of the world’s premier asset management companies. The company has assets under four segments; Real Estate, Infrastructure, Renewable Power, and Private Equity. BAM also has a very impressive compound annual shareholder return of 16% and is targeting 10-15% annualized growth over the long-term.

1.4 billion in annualized distributable cash flow. Although BAM has the lowest dividend yield of all companies on the list at 1.54%, their current payout ratio of 44% leaves ample room for continued dividend growth moving forward. Brookfield Asset Management is a global alternative asset manager focusing on real estate, infrastructure, renewable energy as well as private equity. Infrastructure investments accounted for the largest portion of investments at 46%, followed by real estate (21%), private equity (19%) and renewable power (14%) over the last twelve months.

Over 85% of its revenues come from long-term investments. The firm serves institutional and retail clients through its four partnerships - Brookfield Property Partners, Brookfield Infrastructure Partners, Brookfield Renewable Partners and Brookfield Business Partners. All these businesses seek to give long-term returns in the 12 -15% range. 250 billion worth of assets under management. Brookfield Asset Management has more than 100 offices in over 30 countries and invests in North America, EMEA, South America and Asia-Pacific regions. It acquires high-quality assets at favorable valuations and finances them through low cost, long-term capital.

The firm’s long-standing experience and reputation enable it to raise billions of dollars from institutional investors. Brookfield Asset Management is in a good position to access multiple sources of capital and allocate it to the best available opportunities globally. Worldwide presence, a highly liquid balance sheet, strong investment expertise across asset classes and ownership of diversified assets differentiate Brookfield Asset Management from competitors.

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