Goldman Sachs has a list of global stocks it expects will outperform in 2025.
In particular, the investment bank is bullish on three names – Novozymes, Kawasaki Heavy Industries, and PetroChina.
Let’s take a closer look at what each of these three names have in store for investors.
Novozymes A/S (CPH: NSIS-B)
Goldman Sachs sees a 42% upside in shares of this Danish biotechnology company that is broadly known for industrial enzymes and biopharmaceutical ingredients.
Its analyst Georgina Fraser expects focus on sustainability, health and wellness to drive solid demand for Novozymes in 2025.
The company’s “leading market share in enzymes and cultures, portfolio breadth and R&D spend significantly above peers, support a superior fundamental outlook,” she argued in a research note on Tuesday.
Novozymes stock is currently trading at a slight discount to its peers as well.
Fraser is bullish on the biotechnology company as “substitution of traditional petrochemicals with bio-based alternatives” could double its organic sales growth. Expansion in high growth areas will lift its per-share earnings growth by 25% as well, she added.
Novozymes shares are currently down more than 15% versus their year-to-date high in September.
Kawasaki Heavy Industries Ltd (TYO: 7012)
Goldman Sachs expects shares of this motorcycle, aerospace, and defense equipment manufacturer to hit 8,000 Japanese yen by the end of next year, which indicates potential for a 43% upside from current levels.
Its analyst Yuichiro Isayama likes KHI as its among the largest heavy industry companies based out of Japan and “the contribution to profit growth from its aerospace/defense business is comparable to peers Mitsubishi Heavy Industries and IHI Corporation.”
Kawasaki Heavy Industries stock has significantly underperformed those two rivals in 2024 but its “considerably lower valuation is compelling given its high exposure to the aerospace/defense sector,” according to Isayama.
The Japanese government has recently renewed defense guidelines that could drive steady earnings growth and wider margins for Kawasaki Heavy Industries, he added.
KHI shares are currently down nearly 15% versus their recent high.
PetroChina (SHA: 601857)
Goldman Sachs expects shares of this Chinese oil and gas behemoth to hit 8.1 Hong Kong dollars next year that translates to about a 47% upside from here.
Its analyst Nikhil Bhandari dubbed PetroChina an “underappreciated gas story” in his recent report and said it stands to benefit from “another year of strong cash flow given its significant exposure to upstream gas production.”
Bhandari expects the company’s upstream gas earnings to top contribution from its oil segment on the back of higher gas volumes next year, “enhancing PetroChina’s earnings resilience against global oil price changes.”
PetroChina stock may be worth owning also because Goldman Sachs forecasts a dividend yield of 8.0% and free cash flow yield of about 15% for the energy company in 2025.
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