Big banks are on deck to report quarterly results this week and two pros say one name stands out among the group: Goldman Sachs Group Inc (NYSE: GS).
Newton: 'Decent Signs Of Strength'
The banking sector was a "relative dog" for the first nine months of 2019, especially when the yield curve inverted back in August, Mark Newton, president and founder of Newton Advisors, said Friday on CNBC. But over the past three months, the sentiment improved and the bank sector was among the top performers in the overall market.
Newton will focus on how banks will redeploy their capital and invest in their own businesses to become more "fintech focused" to better survive a low yield environment. Among the crowded group which fits the profile is Goldman Sachs whose stock has some catching up to do.
"I would buy Goldman Sachs before I would touch things like Bank of America or Citigroup," Newton said. "I think Goldman can potentially get back towards former highs."
Harte: Goldman Top Pick
Street analysts aren't particularly bullish on Goldman Sachs' 2020 outlook given a consensus 5% share price upside. This could change as analysts revise their outlooks higher as Goldman offers a more positive view for 2020, Piper Sandler's Jeff Harte said on "Squawk Box."
Goldman could offer a few potential catalysts in the near-term, including a favorable 1MDB settlement, he said. In fact, the company postponed its 2019 investor day presentation until January so it is likely to have "good stuff to say."
The stock has a potential upside of 15% to 20% in 2020 which is "strong" although not a "blowout" year, he said.