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Goldman Sachs says these stocks are a table-pounding buy ahead of earnings

By Michael Bloom

Goldman Sachs says these stocks are a table-pounding buy ahead of earnings

Analysts at Goldman Sachs named a slate of stocks to snap up as earnings season gets underway. There are plenty of buy-rated companies heading into quarterly reports, according to the firm. Those names include LivaNova , Spotify Technology, TKO Group and ServiceNow. Spotify Technology "SPOT is the clear global audio platform leader," wrote analyst Eric Sheridan in his quarterly earnings preview note to clients. The firm said it sees a slew of positive catalysts heading into the streaming service provider's earnings report in November. They include "compounded user growth, rising engagement across multiple format structure & pricing power," Sheridan wrote. Margins are improving, too, he said, as the company is finally seeing its long-awaited goals come to fruition. Sheridan is also bullish on the company's new Chief Financial Officer Christian Luiga, who was appointed to the position in April . The analyst said investors are eager to hear about a more "consistent" shareholder return policy. The stock is up nearly 99% in 2024. TKO Group The sports media company and owner of the UFC is firing on all cylinders ahead of earnings in November. Analyst Stephen Laszczyk said investors' sentiment has "markedly improved" in recent weeks and cited a slew of positive catalysts for his thesis. Demand remains high for mixed martial arts events such as the UFC, according to the analyst. Further, Laszczyk thinks sports rights competition remains robust, making TKO well positioned for negotiating. The analyst said his checks also show no signs of a consumer slowdown as live event demand remains strong. The firm warned it is possible that TKO's quarterly results could come in below consensus, but it said it is still sticking with the stock. TKO Group shares are up 56% in 2024. LivaNova Analyst David Roman and his team recently initiated coverage of LivaNova with a buy rating. The firm said investors should take advantage of any dips in the medical device company's shares. "As the business produces consistent results and the margin profile is enhanced, we think this period of underperformance fades into the rear view mirror," Roman wrote. The analyst said LivaNova is "entering a period with clear and more visible baseline growth drivers, augmented by potential revenue and [earnings per share] upside." The company should get a boost from "new product cycles and pipeline optionality," Roman added. Meanwhile, LivaNova is expected to report earnings in late October. Shares are up more than 1% in 2024. "Positive earnings revisions and continued business momentum represent the core of our thesis and our view that the stock's [price-earnings] can re-rate higher over the next 12-months," Roman said. Spotify Technology "SPOT is the clear global audio platform leader, which we expect to translate into elements of scaled compounded user growth, rising engagement across multiple format structure & pricing power for our operating forecast period. ... The potential for a more consistent shareholder return policy that more mirrors its global TMT peer group in the coming years." ServiceNow "...we believe ServiceNow is well positioned to execute against its FY24 Subscription revenue guidance and grow its share in a $275bn TAM [total addressable market]. Longer-term, we are 5% above management's target for $15bn+ in revenue by FY27 as we believe steady execution and impressive innovation velocity position the company well to sustainably grow 20%+ with best-in-class unit economics." LivaNova "Our thesis for LIVN is predicated on the company is entering a period with clear & more visible baseline growth drivers, augmented by potential revenue & EPS upside from new product cycles & pipeline optionality ... As the business produces consistent results & the margin profile is enhanced, we think this period of underperformance fades into rear view mirror. ... Positive earnings revisions & continued business momentum represent the core of our thesis and our view that the stock's P/E can re-rate higher over the next 12-months." TKO Group "In our view, investor sentiment on both TKO Group and the broader Sports Media sector has markedly improved over the past few weeks, given reinforcing statements and data points intra-quarter that support the view that i) sports rights are still in high demand from content distributors and ii) Live Events are not seeing any signs of consumer weakness in ticketing volume or pricing."

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