GOLDMAN: Here are the 40 cheapest stocks on the market

The S&P 500 climbed just 1% in the first quarter.

“We expect the S&P 500 will reach 2100 by year-end, representing a 2% price gain from the current level,” Goldman’s David Kostin wrote.

Kostin notes that the health care and consumer discretionary sectors have been two of the best performing this year.

Kostin’s new quarterly chartbook includes a list of 40 S&P 500 stocks offering the most upside relative to Goldman Sachs analysts’ price targets.

We’ve ranked the stocks from those with the least upside to those that have the biggest potential gains relative to Goldman’s target.

Marathon Petroleum

Ticker: MPC

Price as of March 31: $US102.39

Upside to target: 19.2%

Comment: The company returned $US2.7 billion to shareholders in 2014, including $US820 million in the first quarter.

Source: Goldman Sachs

Vertex Pharmaceuticals

Ticker: VRTX

Price as of March 31: $US117.97

Upside to target: 19.5%

Comment: Net income fell 499% to -$US176.66 million in the fourth quarter, from $US44.29 a year ago.

Source: Goldman Sachs

L-3 Communications

Ticker: LLL

Price as of March 31: $US125.79

Upside to target: 20.0%

Comment: The company's National Security Solutions business received a contract worth $US117 million for the U.S. Army's Medical Communications for Combat Casualty Care (MC4) program.

Source: Goldman Sachs

Priceline

Ticker: PCLN

Price as of March 31: $US1164.15

Upside to target: 20.3%

Comment: Shares rose nearly 2% April 1 after Stifel analysts upgraded the stock to 'Buy' from 'Hold,' with a price target of $US1,400.

Source: Goldman Sachs

Mead Johnson Nutrition

Ticker: MJN

Price as of March 31: $US100.53

Upside to target: 20.4%

Comment: Zacks downgraded the stock to 'Sell' from 'Hold' after a mixed fourth quarter performance. 'Gross margin trend, currency headwinds and legal issues continue to pose challenges,' the analyst wrote, according to The Legacy.

Source: Goldman Sachs

Tiffany & Co.

Ticker: TIF

Price as of March 31: $US88.01

Upside to target: 20.4%

Comment: Comparable store sales in the last holiday period declined 1% year-over-year on a constant-exchange-rate basis in the Americas.

Source: Goldman Sachs

Intuitive Surgical

Ticker: ISRG

Price as of March 31: $US505.03

Upside to target: 20.8%

Comment: 'Intuitive Surgical's DaVinci robots will have some new competition due to a combined effort from Google and Johnson & Johnson,' Wired reported.

Source: Goldman Sachs

Twenty-First Century Fox

Ticker: FOXA

Price as of March 31: $US33.84

Upside to target: 21.2%

Comment: 'I am also very proud of the creative successes that we have achieved at Twentieth Century Fox, which set a global box office record in 2014 and leads the industry with 24 Academy Award nominations, including Best Picture nominations for 'Birdman' and 'The Grand Budapest Hotel,'' CEO Rupert Murdoch said in the Q2 earnings release.

Source: Goldman Sachs

EMC Corp.

Ticker: EMC

Price as of March 31: $US25.56

Upside to target: 21.3%

Comment: EMC was the 8th worst-performing stock on the S&P 500 in the first quarter, with shares falling by over 14%.

Source: Goldman Sachs

FLIR Systems

Ticker: FLIR

Price as of March 31: $US31.28

Upside to target: 21.5%

Comment: '2014 represented a significant year for FLIR in the thermal imaging industry,' CEO Andy Teich said during the Q4 2014 earnings call. 'Early in the year we launched our revolutionary new low-cost thermal imaging camera core, Lepton, and the world's first truly consumer oriented thermal camera, the FLIR ONE.'

Source: Goldman Sachs

Monsanto

Ticker: MON

Price as of March 31: $US112.54

Upside to target: 22.6%

Comment: Shares rose by more than 4% after the company announced that its newest genetically modified soybeans grew fivefold in 2014 and will double next year, Bloomberg reported.

Source: Goldman Sachs

Actavis

Ticker: ACT

Price as of March 31: $US297.62

Upside to target: 22.6%

Comment: Actavis intended to raise $US22 billion in bonds to fund its acquisition of Allergan, but got over $US70 billion of orders, Bloomberg reported.

Source: Goldman Sachs

General Motors

Ticker: GM

Price as of March 31: $US37.50

Upside to target: 22.7%

Comment: General Motors is stopping production in Russia, Europe's third largest market.

Source: Goldman Sachs

Union Pacific

Ticker: UNP

Price as of March 31: $US108.31

Upside to target: 22.8%

Comment: Union Pacific's profits beat estimates in the third quarter, rising 19% to $US1.37 billion 'boosted by a bumper grain crop and a rebound in consumer demand,' Bloomberg reported.

Source: Goldman Sachs

Cisco Systems

Ticker: CSCO

Price as of March 31: $US27.53

Upside to target: 23.5%

Comment: Business Insider's Julie Bort reported: 'Facebook's vice president of infrastructure, Jason Taylor, made several announcements at the Open Compute Project Summit in San Jose, California, spelling out how the company could topple Cisco's dominance of the $US23 billion ethernet switch market.'

Source: Goldman Sachs

Juniper Networks

Ticker: JNPR

Price as of March 31: $US22.58

Upside to target: 24.0%

Comment: A networking solution unveiled Monday 'is designed to vastly improve the performance of applications that handle market and social media data feeds, execution routing, and big data analytics, empowering financial firms to make decisions faster, using real-time information,' Andrew Bach, chief architect for financial services at Juniper Networks, told Enterprise Technology.

Source: Goldman Sachs

Discover Financial Services

Ticker: DFS

Price as of March 31: $US56.35

Upside to target: 24.2%

Comment: Morningstar analysts rated the firm's credit BBB+ Monday and the stock 'three stars,' Dakota Financial News reported.

Source: Goldman Sachs

Vulcan Materials

Ticker: VMC

Price as of March 31: $US84.30

Upside to target: 24.6%

Comment: Vulcan recently announced that it will redeem all its outstanding notes worth $US219 million, which have an interest rate of 6.40% and are due in 2017.

Source: Goldman Sachs

AbbVie

A screen displays the share price for pharmaceutical maker AbbVie on the floor of the New York Stock Exchange July 18, 2014.

Ticker: ABBV

Price as of March 31: $US58.54

Upside to target: 24.7%

Comment: AbbVie announced the acquisition of Pharmacyclics for $US261.25 per share in cash and stock for its 'strong expertise in kinase biology and oncology discovery.'

Source: Goldman Sachs

Harley-Davidson

Ticker: HOG

Price as of March 31: $US60.74

Upside to target: 25.1%

Comment: 'In international markets, our dealers in Asia Pacific , EMEA and Latin America posted their highest new motorcycle sales on record for each region, delivering on our expectation for international sales to grow at a faster rate than U.S. sales,' CEO Keith Wandell said in the Q4 earnings release.

Source: Goldman Sachs

Cabot Oil & Gas

Ticker: COG

Price as of March 31: $US29.53

Upside to target: 25.3%

Comment: The company saw record year-over-year production of crude oil and natural gas, as well as net income, in 2014.

Source: Goldman Sachs

Delphi Automotive

Ticker: DLPH

Price as of March 31: $US79.74

Upside to target: 25.4%

Comment: Delphi Automotive announced April 2 that it completed a driverless, 3,400-mile long journey from San Francisco to New York.

Source: Goldman Sachs

Lam Research

Ticker: LRCX

Price as of March 31: $US70.24

Upside to target: 29.6%

Comment: 'For the year we grew revenue at twice the rate of the industry and made good progress on our market share objectives,' said CEO Martin Anstice in the Q2 earnings release. 'Our strong execution combined with a meaningful market expansion is enabling a compelling multi-year growth opportunity.'

Source: Goldman Sachs

Amgen

Ticker: AMGN

Price as of March 31: $US159.85

Upside to target: 30.1%

Comment: 'Amgen plans to cut about 300 jobs and close one of its South San Francisco buildings as part of a reorganization that will combine cancer organisation with Onyx Pharmaceuticals, which the biotech bought for $US10.4 billion,' the Wall Street Journal reported.

Source: Goldman Sachs

Wynn Resorts

Ticker: WYNN

Price as of March 31: $US125.88

Upside to target: 31.9%

Comment: Wynn Resorts has encouraged its Macau-based staff to take unpaid leave, as customer numbers to the island continue to decline.

Source: Goldman Sachs

SanDisk

Ticker: SNDK

Price as of March 31: $US63.62

Upside to target: 32.0%

Comment: In a note Monday, Bernstein wrote that SanDisk shares are trading 40% below the company's replacement value, indicating that it is an attractive takeover candidate, according to Benzinga.

Source: Goldman Sachs

Garmin

Ticker: GRMN

Price as of March 31: $US47.52

Upside to target: 32.6%

Comment: Citi downgraded Garmin to 'Sell'on concern that the upcoming Apple Watch will erode its market share.

Source: Goldman Sachs

PACCAR

Ticker: PCAR

Price as of March 31: $US63.14

Upside to target: 33.0%

Comment: 'PACCAR reported record annual revenues of $US18.99 billion and net income of $US1.36 billion for 2014,' CEO Ron Armstrong said in the Q4 earnings release. 'PACCAR achieved the second best annual net profit in the company's history and the 76th consecutive year of net income.'

Source: Goldman Sachs

Alcoa

Ticker: AA

Price as of March 31: $US12.92

Upside to target: 39.3%

Comment: Alcoa kicks off first quarter earnings season Wednesday and is expected to post $US0.29 in EPS, up from $US0.09 a year ago, and $US6.09 billion in revenues, according to Estimize estimates cited in Benzinga.

Source: Goldman Sachs

Southwest Airlines

Ticker: LUV

Price as of March 31: $US44.30

Upside to target: 40.0%

Comment: 'Southwest Airlines Co. earned a record profit last year and the CEO benefited with a 24 per cent increase in compensation, to $US5 million,' the Associated Press reported.

Source: Goldman Sachs

Michael Kors

Ticker: KORS

Price as of March 31: $US65.75

Upside to target: 46.0%

Comment: Heavy discounts dragged down third-quarter profits for the luxury retailer, Reuters reported.

Source: Goldman Sachs

Keurig Green Mountain

Ticker: GMCR

Price as of March 31: $US111.73

Upside to target: 48.6%

Comment: The company announced an agreement with Riley Foods that will introduce new brands under the K-Cup umbrella.

Source: Goldman Sachs

Chesapeake Energy

Ticker: CHK

Price as of March 31: $US14.16

Upside to target: 55.4%

Comment: Chesapeake slashed its capital expenditures forecast to between $US4 billion and $US4.5 billion this year, down from $US6.7 billion in 2014.

Source: Goldman Sachs

We're keeping an eye on these tickers.

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