Goldman Sachs predicted that U.S. stock returns would be lackluster over the next decade, primarily due to two key factors: extreme market concentration and inflated valuations. The firm predicts that the S&P 500 will return just 3% annually over the next decade, putting it in the 7th percentile for 10-year returns since 1930.
Goldman Sachs believes investors should look to emerging markets for higher returns over the next 10 years.
With so much of the S&P 500 concentrated in Magnificent 7 stocks, if they start to sell off, it could trigger a tsunami of selling.
Goldman Sachs Strong Buy value dividend stocks now make sense for more conservative growth and income investors.
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US action The market is currently at its highest level in almost 100 years, and has been dominated recently by the Magnificent 7, a small group of large-cap technology stocks. Sustaining the exceptional growth rates and profit margins that have fueled these market leaders is historically difficult over the long term, Goldman Sachs says, so the concentrated rally is unlikely to continue at the pace it has been recently.
In addition, The firm’s model predicts a 72% chance that stocks will underperform bonds over the next decade, according to Wealth Professional, a stark contrast to the 13% annual return investors have enjoyed over the past decade. After three years of double-digit returns, it’s probably time for investors to reallocate their portfolios.
Founded in 1869 Goldman Sachs is the second largest investment bank in the world by revenue and ranks 55th in the Fortune 500 list of the largest US corporations by total revenue. The Wall Street white-glove giant offers financing, advisory services, risk allocation and hedging to the firm’s institutional and corporate clients. It also conducts some of Wall Street’s most sought-after research and is a bellwether for the financial industry.
We checked the company’s top stocks for dividend-paying value companies that conservative growth and income investors should consider moving ahead of a potentially volatile 2026, including midterm elections that could reshape Congress next year.
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Goldman Sachs is a recognized leader in investment on Wall Street and around the world. The firm’s top-tier research department continues to provide institutional and high-net-worth clients with the best ideas across the investment spectrum. This is likely to continue for many years.
This health care the giant offers an excellent investment opportunity with a dividend yield of 1.87%. Abbott Laboratories Inc. (NYSE: ABT) engages in the discovery, development, manufacture and sale of a broad and diverse line of healthcare products.
Company operates through four segments:
Established The Pharmaceuticals segment is engaged in the international sale of broad-brand generic pharmaceutical products.
Diagnostics The Products segment is engaged in the sale of diagnostic systems and tests to blood banks, hospitals, commercial laboratories and alternative care research centers worldwide.
Nutrition The Products segment is involved in the worldwide sale of a wide range of adult and pediatric nutritional products.
Medical The Devices segment includes global sales of:
Rhythm control
Electrophysiology
Heart failure
Blood vessels
Structural heart
Neuromodulation
Diabetes care products
Goldman Sachs has a price target of $157, implying a 17% upside.
Altria Group Inc. (NYSE: MO) is one of the world’s largest manufacturers and sellers of tobacco, cigarettes and related products. This tobacco company offers investors an attractive entry point and a generous dividend yield of 7.20%. Altria manufactures and markets smoking and oral tobacco products in the United States through its subsidiaries.
Companies the dividend payout is based on free cash flow, which ranges from approximately 64% to 80% per quarter. Free cash flow has exceeded dividend payments in recent quarters, providing a solid buffer. Altria generates strong cash flow from its core tobacco business, which provides a stable base, albeit one with regulatory risk, and yields among the highest in the S&P 500, at least for now.
Company primarily sells cigarettes under the Marlboro brand, as well as:
Cigars and pipe tobacco, mainly under the Black & Mild and Middleton brands
Wet smokeless tobacco and snus products with Copenhagen, Skoal, Red Seal and Husky brands
on! Oral nicotine pouches
e-vapor products with the NJOY ACE brand
He is selling his tobacco products primarily to wholesalers, including distributors and large retail organizations such as chain stores.
Altria used own more than 10% of the world’s largest brewer Anheuser-Busch InBev SA (NYSE: BUD ). Last year, the company sold 35 million from 197 million shares through a global secondary offering. That’s 18% of its holdings, but still leaves 8% of its shares outstanding in its back pocket. Altria also announced a $2.4 billion stock buyback plan, partially funded by the sale.
Goldman Sachs The price target is $73.
AT&T Inc. (NYSE: T ) is the fourth-largest telecommunications company in the world by revenue. The aging telecommunications company has been undergoing a long-term restructuring process, during which it reduced its dividend to 4.47 percent. Seventeen analysts have given the stock a buy rating, indicating broad Wall Street support. AT&T provides a variety of telecommunications, media and technology services worldwide. The Communications segment offers wireless voice and data services.
AT&T sells through company-owned stores, agents and third-party retail stores:
AT&T also provides:
Data
The voice
Safety
Cloud solutions
Outsourced services
Manages and provides professional services
Customer premises equipment for international corporations, small and medium-sized enterprises and public and wholesale customers
In addition, this segment provides broadband fiber optic and legacy telephony voice communication services to private customers.
She trades its communications services and products by:
AT&T
Cricket
AT&T PREPAID
AT&T Fiber.
Companies The Latin America segment provides wireless services in Mexico and video services in Latin America. This segment markets its services and products under the AT&T and Unefon brands.
Goldman Sachs has a $33 price target on the stock.
Happy holidays just around the corner is a great opportunity for growth and income investors, offering a solid 3.24% dividend yield. Hershey Co. (NYSE: HSY ) is a snack food company that operates in the following segments:
North America The Confectionery segment is responsible for the traditional chocolate and non-chocolate confectionery market positions in the US and Canada.
This includes her business:
Chocolate and non-chocolate confectionery
Rubber and fresh produce
Protein bars
Lubricants
Snacks and mixes
Storage and feeding lines
This segment also includes retail activities.
North America The Salty Snacks segment is responsible for salty snacks in the United States. This includes ready-to-eat popcorn, fried and low-fat snacks, brownies and other similar snacks.
Companies the portfolio includes chocolate and confectionery brands such as:
Goldman Sachs The stock has a price target of $222, which represents a 19% upside for investors.
This is one of the safest ways for investors to play the energy sector as refining capacity has declined and supply has increased. Valero Energy Corp. (NYSE: VLO) is an international producer and marketer of petroleum-based and low-carbon liquid transportation fuels, as well as petrochemical products.
Company owns more than 15 oil refineries located in the United States, Canada and the United Kingdom. It mainly sells its products:
United States
Canada
United Kingdom
Ireland
Latin America
Valero works in three segments. The Refinery segment includes refinery operations, related activities related to the marketing of refined petroleum products, and logistics assets that support these operations.
Renewable The Diesel segment includes Diamond Green Diesel (DGD) operations and related activities, including the trading of renewable diesel and naphtha.
Ethanol segment includes ethanol plant operations and related activities related to the marketing of ethanol and other products.
Goldman Sachs it has a price target of $197.
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