Goldman Sachs has issued buy ratings on five prominent stocks heading into the third-quarter earnings season, projecting significant upside despite four of the companies suffering losses in 2026.
Underperforming Picks and Price Targets
Among the four struggling stocks, Nu Holdings, the parent company of Brazilian digital bank Nubank, has taken the heaviest hit. Its shares closed at $13.43 on October 2, representing a 19.77% decline in 2026 and leaving it roughly 29% below its 52-week high of $18.98. Despite the pullback, Goldman Sachs analyst Tito Labarta maintained a $23 price target—implying nearly 71% upside—citing Nu's expansion into US consumer credit through an ultra-low cost digital approach.
Disney and Omnicom occupy the middle ground among Goldman's selections. Disney stock has shed 10.18% this year to $102.19. Analyst Michael Ng trimmed his target price to $140 from $144, which still sits 37% above current levels, while estimating earnings per share (EPS) will compound at roughly 13% annually. Omnicom has dropped 8.17% to $74.15 and trades at 6x 2027e EPS, while UPS has fallen 6.22% to $93.02 as it completes its wind-down of Amazon delivery volumes to streamline its domestic network.
Key Takeaways
- Baker Hughes is the sole gainer among Goldman's five picks, rising 22.97% to $56 in 2026.
- Analyst price targets project upside ranging from 27% for Baker Hughes to 71% for Nu Holdings.
- Earnings announcements begin October 20 with Omnicom and run through mid-November.
Baker Hughes Bucking the Trend
Standing in sharp contrast to the rest of the group, oilfield services provider Baker Hughes has advanced 22.97% this year to $56. Analyst Neil Mehta reinstated coverage with a buy rating and a $71 target, implying roughly 27% upside. Mehta highlighted operational synergies stemming from its completed acquisition of Chart Industries, a transaction where Goldman Sachs acted as adviser and debt financier. The performance gap between Baker Hughes and Nu Holdings spans nearly 43 percentage points.
Goldman's optimistic calls contrast with broader market caution, as commentators like Jim Cramer warn of a tough Q3 earnings season due to sustained macroeconomic pressures. Omnicom will be the first test of Goldman's outlook when it reports on October 20, followed by UPS and Baker Hughes on October 27, and Disney and Nu Holdings around November 12. These reports arrive as some institutional analysts project that Wall Street buyers will reload US stocks in Q4.
Why It Matters
Goldman Sachs is taking a clear counter-consensus position by overweighting beaten-down equities ahead of corporate reporting. If these underperforming companies demonstrate steady organic growth and operational efficiency, it could validate projections of institutional buying resuming across equity markets in the fourth quarter. Conversely, if earnings fail to overcome macroeconomic drag, deep valuation discounts may persist longer than anticipated.
