The artificial intelligence rally over the past two and a half years, led by the so-called Magnificent 7, delivered remarkable returns for investors in those stocks. However, those heady days appear to be over, at least for now. After a brutal sell-off that briefly pushed the S&P 500 and the Nasdaq into or close to bear market territory, both indexes have since recovered their losses and are trading close to all-time highs again. Investors are now faced with the challenge of picking the right path for the rest of the year and beyond. The fork in the road of investing still presents numerous concerns, including tariffs, the potential for a 2025 recession, and geopolitical concerns.
24/7 Wall St. Key Points:
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After a volatile stretch, yields in the Treasury bond market have stabilized.
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Concerns about the volatility in the bond and stock markets are leading investors to top-quality dividend stocks.
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The Goldman Sachs Conviction List contains the top stock picks at one of Wall Street’s leading firms.
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We decided to screen the current Goldman Sachs U.S. Conviction List for stocks with solid total return potential that pay dependable dividends for those seeking passive income. Three top companies caught our attention, paying reliable, in some cases substantial, dividends with tremendous upside potential relative to the Goldman Sachs target prices. When they are among the top stock picks at the world’s most prestigious investment bank, they likely will catch the eye of savvy investors.
Why we recommend Goldman Sachs stocks
Goldman Sachs is the acknowledged leader in the investment landscape on Wall Street and worldwide. The firm’s top-notch research department continues to provide clients with the best ideas across the investment spectrum and is likely to do so for years to come.
Baxter International
This healthcare giant offers a solid dividend and outstanding growth potential for 2025. Baxter International Inc. (NYSE: BAX) provides a portfolio of healthcare products in the United States. It operates through three segments:
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Medical Products and Therapies
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Healthcare Systems and Technologies
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Pharmaceuticals
The company offers:
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Sterile intravenous (IV) solutions
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Infusion systems and devices
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Parenteral nutrition therapies
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Administrative sets
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Generic injectable pharmaceuticals
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Surgical hemostat and sealant products
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Advanced surgical equipment
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Smart bed systems
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Patient monitoring and diagnostic technologies
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Respiratory health devices
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Advanced equipment for the surgical space, comprising operating room integration technologies
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Precision positioning devices and other accessories.
Baxter also provides specialty injectable pharmaceuticals, inhaled anesthetics, and compounding services for prescription drugs.
Its products are used in:
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Hospitals
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Nursing homes
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Rehabilitation centers
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Ambulatory surgery centers
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Doctors’ offices
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Kidney dialysis centers
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Patients at home under physician supervision
The company sells its products through a direct sales force, independent distributors, drug wholesalers, specialty pharmacies, or other alternate site providers.
It has an agreement with Celerity Pharmaceuticals to develop generic injectable premix and oncolytic products for acute care. The company operates in Eastern Europe, the Middle East, Africa, Latin America, Asia, Western Europe, Canada, Japan, Australia, and New Zealand.
Goldman Sachs has a target price of $39. Achieving the target would result in a 23% gain.
Kodiak Gas Services
With natural gas in big demand, this is a solid energy idea. Kodiak Gas Services Inc. (NYSE: KGS) is a contract compression service provider in the United States, serving as a link in the infrastructure that enables the production and transportation of natural gas and oil.
The company’s Contract Services segment comprises operating company-owned and customer-owned compression, gas treating, and cooling infrastructure, enabling the production, gathering, processing, and transportation of natural gas and oil.
Its Other Services segment consists of a broad range of services to support the needs of its customers, including:
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Station construction
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Customer-owned compression maintenance and overhaul
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Freight and crane charges
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Parts sales, and other ancillary time and material-based offerings
The company offers its services to oil and gas producers and midstream customers in high-volume gas gathering systems, processing facilities, multi-well gas lift applications, and natural gas transmission systems.
Reaching the $44 Goldman Sachs price target would be a 24% gain.
Viper Energy
Viper Energy Inc. (NASDAQ: VNOM) owns and acquires mineral and royalty interests in oil and natural gas properties in the Permian Basin. With an eye-popping dividend, this mid-cap energy play has tremendous upside to the Goldman Sachs target price. Viper Energy is an independent oil and natural gas company focused on the acquisition, development, exploration, and exploitation of unconventional, onshore oil and natural gas reserves.
The company owns, acquires, and exploits oil and natural gas properties in North America. The company’s assets consist of mineral and royalty interests in oil and natural gas properties, primarily located in the Permian Basin of West Texas, which are substantially all leased to working interest owners who bear the costs of operation and development.
Its assets consist of mineral interests and royalty interests underlying 987,861 gross acres and 35,671 net royalty acres primarily in the Permian Basin.
Viper Energy’s mineral and royalty interests located in Howard County, Texas, include approximately 1,691 net royalty acres in the Permian Basin and have an average net royalty interest of roughly 8.6%.
The Goldman Sachs price target of $72 represents a stunning 73% gain from current levels.
Goldman Sachs Loves Four Recession-Proof High-Yield Utility Dividend Stocks
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