TipRanks
Buy These 2 New Stocks Before They Jump Over 60%, Says Goldman Sachs
The S&P 500 is showing a 6-month gain of 24%. Stocks generally have been gainers as the coronavirus crisis recedes, economies reopen, and the Federal Reserve remains committed to low-rate regime. In this environment, it’s no wonder that many companies are considering going public through an IPO. The high-return environment we’re experiencing right now makes the IPO attractive as a way to not just raise capital but to also cash in on the rising stock market. With interest rates at historic lows, stocks have become the go-to vehicle for investors seeking growth, and for companies seeking investors – the cohort conducting or contemplating IPOs – the partnership is natural. An IPO brings costs with it, in the form of compliance and disclosure rules – the market’s rapid gains outweigh them for the present. This brings us to Goldman Sachs. The banking firm’s stock analysts have been looking for the equities primed to gain in current conditions. And just this week, they’ve tapped two stocks new to the public markets as likely to jump 60% or more in coming months – a solid return that investors should note. We ran the two through TipRanks database to see what other Wall Street’s analysts have to say about them. Compass, Inc. (COMP) Tech meets real estate in Compass, Inc., a technology company founded in 2012 to make relevant, cloud-based tools available to realtors. The company’s platform facilitates buying, renting, and selling real estate. The company aims to replace the real estate industry’s antiquated ‘paper’ model with a seamless digital experience that empowers agents and satisfies both buyers and sellers. The company’s large size, and its agent-centered approach, give it advantages over online rivals such as Redfin and Zillow. Compass boasts a 4% market share in the crowded residential segment; by comparison, competitor Redfin’s market share is 1%. Looking at Compass by the numbers paints an impressive picture. In its fiscal year 2020, Compass employed over 19,000 real estate agents, facilitated over 145,000 transactions with a total gross value of $152 billion, saw top-line revenues of $3.7 billion, and operated in 46 markets across 16 states. Based on that performance, on April 1, the company went public. Compass put 25 million shares of common stock on the market, at price of $18 each, and netted $450 million. Among the bulls is Goldman analyst Michael Ng, who likes the fundamental of this newly public stock. “Compass is the largest independent U.S. real estate brokerage by gross transaction value (GTV) and differentiates itself from competing brokerages by providing its residential real estate agents with a first party, end-to-end platform for workflow and customer management, driving higher annual commissions for Compass agents over…
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