Goldman Sachs updates conviction lists: Adds Johnson & Johnson and Axis Bank

Published 01/05/2025, 13:10
© Reuters

Investing.com -- Goldman Sachs has refreshed its Conviction Lists for both the U.S. and Asia-Pacific regions, highlighting additions that reflect resilience, growth potential, and valuation upside. 

Johnson & Johnson (NYSE:JNJ) and Houlihan Lokey (NYSE:HLI) were added to the U.S. list, while Axis Bank (NSE:AXBK) joined the APAC roster alongside Horizon Robotics and NextDC.

In the U.S., Goldman said Johnson & Johnson is a “stable, defensive grower with the industry’s strongest balance sheet.” 

Analysts pointed to the company’s “continued high-ROIC investments in the Innovative Medicines segment” and a “strong pipeline of drugs in trial stage” that could offset a looming patent cliff for its key drug Stelera. 

The firm removed Meritage (NYSE:MTH) Homes from the list.

Houlihan Lokey, a boutique investment bank, earned its place on the list for offering “best-in-class protection from an economic slowdown through its restructuring business,” which accounted for roughly 25% of revenue in calendar year 2024. 

Goldman also noted “margin stability” and growth potential under the firm’s new CEO, who has pivoted toward acquisitions.

In Asia-Pacific, Axis Bank was added based on its improving profitability prospects. Goldman expects “an improvement in Axis Bank’s profitability in 2HFY26-FY27E,” driven by bottoming net interest margins, better systemic liquidity, and controlled costs. 

Goldman also noted that Axis trades at a discount to HDFC and ICICI, and said “this gap should narrow as profitability bottoms out.”

Also joining the APAC list are Horizon Robotics and NextDC, both cited for strong growth outlooks. Horizon is forecast to grow revenue at a 54% CAGR through 2030, while NextDC’s contracted order book could double EBITDA once constructed.

Goldman removed HDFC Bank, JD.com, Murata, and AAC from the APAC Conviction List as part of the update.

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