The recent sharp drawdown in stocks presents a buying opportunity for those stocks that are positioned to withstand a double whammy of higher interest rates and an economic slowdown, according to Goldman Sachs.
"Although we expect headwinds to discount rates and balance sheets to persist, we would view a substantial further downgrade to the growth outlook as a buying opportunity," David Kostin, Goldman's chief U.S. equity strategist, said in a note to clients.
Therefore, Goldman believes many cyclical stocks, or those with a high sensitivity to the economy, shouldn't suffer.
"We therefore remain wary of long-duration and highly levered stocks but think investors should treat cyclical sell-offs as a buying opportunity," Kostin said.
Energy stocks Devon Energy and Patterson-UTI Energy also made the list.
Persons:
Goldman Sachs, David Kostin, Goldman, Kostin
Organizations:
Academy Sports, PVH Corp, Holdings . Energy, Devon Energy, Patterson, UTI Energy