Goldman Sachs: These three shares are expected to increase by more than 100%
Markets are besieged by volatility, with unpredictable changes that make recent sessions a roller coaster ride. Major indices fell sharply late last week, but Friday’s release of economic data showing strong manufacturing activity provided a boost that slightly reduced market losses. The recent earnings season also gave reasons for optimism: S&P-listed companies, collectively, reported year-on-year earnings gains of 46% in the first quarter, compared to the expected 20%. David Kostin, Goldman Sachs strategist, sees generally positive macro data as supporting stock in an uncertain market environment. “The combination of global reopening, high consumer savings and strong business leverage will drive strong recoveries in both economic growth and earnings … US equities will continue to appreciate, albeit at a slower pace than what has characterized the last twelve months … stocks will remain attractive in relation to cash and bonds, ”Kostin noted. With that in mind, our focus was on three stocks that Goldman Sachs believes have oversized growth prospects, and the company’s analysts predicted a bullish potential of more than 100% for each. Using the TipRanks database, we found that the rest of the street is also on board, as each has a consensus rating of “Strong Buy”. Rain Therapeutics (RAIN) We will start with a public biopharmaceutical company recently Rain Therapeutics. The company develops a tumor agnostic treatment strategy that selects patients based on the underlying genetics rather than the histology of the disease. Rain has two candidate drugs in preparation, RAIN-32, which is undergoing several clinical trials, and RAD52, which is still in the preclinical process. Taking a closer look at the pipeline, we find that RAIN-32, an MDM2 inhibitor called milademetane, has scheduled a phase 3 trial for WD / DD liposarcoma in the second half of this year. At the same time, a phase 2 trial, a study of MDM2 baskets, has also been scheduled for 2H21. Beyond the Phase 3 and Phase 2 Basket WD / DD study, the company is also looking to start another phase 2 study on intimate sarcoma in early 2022. RAD52, the second candidate for the Pipeline of the company, is a new approach to the treatment of breast, prostate, pancreatic and ovarian cancers. The drug is still in the early stages of research, but the selection of top candidates for clinical trials is scheduled to begin next year. As mentioned above, Rain is a public company recently; celebrated its IPO in April this year. The company placed 7,352,941 shares on U.S. public markets, at $ 17 each. The IPO raised about $ 125 million in gross revenue. Observer Graig Suvannavejh, analyst Graig Suvannavejh, writes the opening of this action by Goldman Sachs: “While we are optimistic about the prospects for RAIN-32 in LPS, the revenue opportunity looks modest as we project the highest risk-unadj./adj.a sales of 612 million dollars / 428 million dollars (it supposes a 70% of POS), given only about 3 K of annual incidence in the U.S. That said, our enthusiasm for RAIN it also depends on the potential of RAIN-32 beyond LPS, including intimate sarcoma (an ultra-orphan cancer) and also solid tumors amplified with MDM2, which we see as a substantial market opportunity.In these three, we project a maximum annual risk of $ 2.2 trillion / $ 859 million unadj./adj sales in the US / EU5, with other future indications of RAIN-32 (trials to begin in 2022) and also a preclinical RAD52 program (a synthetic lethality game ) which represents a bullish potential for our forecasts. “In line with the its bullish stance, Suvannavejh values RAIN for buy and the $ 56 target price implies room for an impressive 252% rise potential in the next 12 months. (To view Suvannavejh’s history, click here). Returning to the rest of the street, other analysts echo Suvannavejh’s sentiment. Since Buy recommendations have only been published in the last three months, RAIN is gaining consensus from Strong Buy analysts. With the average price targeting at $ 33.75, the shares could rise 112% from current levels. (See RAIN Stock Analysis at TipRanks) Relmada Therapeutics (RLMD) Goldman Sachs ’next radar stock, Relmada Therapeutics, is a clinical-stage pharmaceutical company that focuses on central nervous system issues. REL-1017, the company’s leading channeling candidate, is a new NMDA receptor channel blocker in development as a treatment for major depressive disorder. Mental health is a major segment of the pharmaceutical industry and the antidepressant piece of the mental health pie is expected to exceed $ 18.5 billion by 2027. Relmada launched RELIANCE I, the first fundamental trial of REL-1017, in December from last year, testing the drug as a complementary treatment for major depression. Last April, there were already two additional studies, RELIANCE II and RELIANCE-OPS. All three are ongoing and a fourth phase 1 study of REL-1017 as monotherapy will begin in the first half of this year. First-line data from the two fundamental studies are expected to be published during 1H22. Goldman Sachs analyst Andrea Tan hedges these shares and awards it a Buy rating along with a $ 78 target price that implies a 103% rise over the next 12 months. (To see Tan’s track record, click here) “We look at a number of key events in 2021+ that could drive value inflection: (1) study of human abuse potential (PAH) against control oxycodone positive in 2Q21 and ketamine in 2H21, where we see the market as a price with too much risk of a negative result (see scenario analysis); (2) basic data of REL-1017 monotherapy in 4Q21; and ( 3) define pivotal data in attached MDD (maximum GSe sales of $ 2.5 billion in 2033) during 1H22 after the presentation of the NDA, all of which are constructive given the differentiated profile that demonstrates the start fast action, improved efficiency and good tolerability so far, ”Tan opined. What should the rest of the street have to say? 3 purchases and no withholdings or sales add up to a strong buy consensus rating. Considering the average price target of $ 67.67, the shares could rise 76% the following year. (See analysis of RLMD shares in TipRanks) Agiliti (AGTI) We will close our look at Goldman selections with high potential with Agiliti. The company is a supplier of medical equipment, which offers hospitals and healthcare systems a range of bariatrics, beds, therapy mattresses, fall prevention devices, ventilators, breast pumps, patient monitors, adjustable chairs of medical quality and surgical equipment, along with technical assistance, clinical engineering and on-site management to properly use, maintain and adjust the myriad of devices. According to figures, Agiliti has more than 90 service centers in the 48 lowest states, supporting more than 800,000 medical teams in more than 7,000 acute care hospitals and alternative medical centers. On April 23 this year, Agility debuted its shares on the NYSE with a IPO that was initially priced at $ 14. The company placed more than 26.3 million shares on the market and raised approximately $ 431.5 million in gross revenue on the first day of trading. Last week, Agiliti released its first quarterly financial report as a public company. First-line revenue, at $ 235 million, was 31% higher than in the first quarter of the previous year. Net income was $ 9.6 million, $ 22.2 million more than net loss in the first quarter of last year and EPS was 9 cents per share. Looking at the company’s advanced track record, Goldman Sachs analyst Amit Hazan noted: “While not reflected in the closing balance sheet for the first quarter, management provided visibility into post-IPO leverage. ‘approximately 3.3x in proforma form. Although somewhat restricted from a managerial point of view in the face of Northfield’s demands, management expects financial and managerial flexibility to carry out opportunistic mergers and acquisitions by the end of this year. Hazan summed up: “We see that AGTI’s end-to-end service model is differentiated and ideally suited to the Hospital’s current operating environment; we see that the current assessment is an attractive entry point … “To that end, Hazan is giving AGTI shares a buy rating, and its $ 43 price target implies a 151% rise for next year. (To view Hazan’s history, click here). In its first weeks in the public markets, AGTI shares have collected 9 reviews, including 8 purchases and only 1 wait. The shares are selling for $ 17.12 and the average price target of $ 21.39 suggests that it has room for 25% upside potential for one year (see stock analysis AGTI and TipRanks). To find good ideas for trading stocks at attractive valuations, visit TipRanks “Best Stocks to Buy,” a recently launched tool that brings together all the knowledge about TipRanks ’own resources. Disclaimer: The views expressed in this article are solely those of prominent analysts. The content is intended for informational purposes only. It is very important to do your own analysis before making any investment.