Goldman Sachs named two European stocks with projected 12-month upside above 100% in its August picks, with UK clean energy developer Ceres Power leading at 168% and German defense contractor Rheinmetall second at 102%. The forecasts arrive as the Stoxx 600 touched a record high on Tuesday. Goldman analysts cited Ceres Power's licensing model and data center exposure despite the stock sliding more than 31% last month, while pointing to Rheinmetall as undervalued amid Europe's military hardware demand following the company's second-quarter beat. European equities continue reaching fresh highs, with the Stoxx 600 closing 0.7% higher at 656.86 points and gaining 10% in 2026.
Goldman Sachs Projects 168% Upside for Ceres Power, 102% for Rheinmetall
Ceres Power stock slid more than 31% last month as investors questioned supply chains, execution, and the durability of AI demand. Goldman analysts read that drop as an entry point, citing its licensing model and exposure to data center growth.
Rheinmetall took second place with a projected 102% upside. The German defense contractor gained 15.1% in July after beating second-quarter estimates. Revenue rose about 69% to 3.289 billion euros, while operating profit hit 562 million euros against expectations of nearly 470 million, according to preliminary figures. Goldman analysts see the stock as sharply undervalued amid Europe's rearming.
Bank Forecasts 64% Gains for BT Group and DSV, Adds ASML to Conviction List
The bank also forecasts 64% upside for BT Group and DSV over 12 months. Analysts point to BT's fiber monetization and DSV's integration of DB Schenker, though DSV shares fell 9.3% in July.
ASML is one of three names Goldman added to its monthly European Conviction Directors' Cut list. Analysts project 52% upside over 12 months. "While the broadening use of AI is a structural driver of demand, ASML's revenue base is diversified across the full semi value chain and its unique product positioning means it captures spend regardless of which application is driving the next wave of chip investment," the analysts said.
Stoxx 600 Reaches Record High as Semiconductor Sector Cools from Mid-June Peaks
The Stoxx 600 closed 0.7% higher at 656.86 points, a new record high. The benchmark index has gained 10% in 2026, while UBS recently raised its year-end target to 690, implying about 5% additional upside.
Sector returns diverged sharply. Semiconductor names led, with Soitec up 371% and AT&S up 330% year-to-date, according to CNBC. That trade has since cooled. AT&S and Aixtron each fell more than 20% from their mid-June peaks, yet Morningstar strategist Michael Field argued the spending behind the sector remains locked in. "The cash is committed to capex and semiconductor firms are seeing the benefit of this spending," he said.
Rheinmetall Reports First-Half Results Thursday
Rheinmetall publishes detailed first-half results on Thursday.
FAQ
What upside did Goldman Sachs project for Ceres Power stocks?
Goldman Sachs projected 168% upside for Ceres Power over 12 months in its August picks. Analysts cited the company's licensing model and exposure to data center growth despite the stock sliding more than 31% last month.
Why did Goldman Sachs name Rheinmetall stocks in its top picks?
Goldman Sachs projected 102% upside for Rheinmetall, pointing to the stock as sharply undervalued amid Europe's rearming. The German defense contractor beat second-quarter estimates with revenue rising about 69% to 3.289 billion euros and operating profit hitting 562 million euros against expectations of nearly 470 million.
