Goldman Sachs Chief U.S. Equity Strategist Ben Snider has highlighted a significant shift in the U.S. stock market environment, emphasizing a tilt towards secular growth companies over cyclical ones as economic growth decelerates. On October 22, 2026, Goldman Sachs updated its equity strategy and pinpointed two stocks—Idexx Laboratories (IDXX) and Zeta Global Holdings (ZETA)—as attractive buys based on their alignment with lasting growth trends that transcend the economic cycle[1][2].
Market Context: Positive but Decelerating Growth
Snider outlined that environments characterized by “positive but decelerating growth” typically yield moderate but positive returns for the S&P 500. Importantly, equity returns in such phases tend to be driven more by earnings growth rather than valuation expansion. Within this setting, companies fueled by secular growth trends usually outperform those dependent on economic cycles. This observation frames Goldman Sachs’ current market outlook as more cautious on cyclical sectors but optimistic about firms riding long-term shifts in consumer behavior and business spending[1][2].
Secular Growth Themes Beyond AI
While artificial intelligence (AI) has been a notable market driver recently, Goldman Sachs identifies broader themes that promise sustainable growth. These include the expansion of e-commerce, demographic shifts such as an aging population, and increased pet ownership—a trend fueling demand for veterinary care. Investors looking for growth opportunities in a slowing economy can focus on companies well-positioned within these evolving markets[1][2].
Idexx Laboratories: Strength in Veterinary Diagnostics and Recurring Revenue
Idexx Laboratories is a $44 billion global leader in veterinary and scientific diagnostics. It provides testing services both through independent labs and point-of-care diagnostic equipment catering to companion animals (like dogs and cats) and livestock (such as cattle and poultry). Additionally, it produces test kits for dairy and water safety[1][2].
Several trends favor Idexx. Millennials and Gen Z are increasingly viewing pets as family members, fueling demand for advanced veterinary diagnostics. Idexx’s business model generates significant recurring revenue from consumables and lab services connected to its diagnostic instruments, which are designed not just as one-time sales but as sources of repeat purchases. In 2025, 79% of Idexx’s revenue came from recurring companion-animal diagnostics, a figure that rose in the second quarter of 2026, where the companion animal group saw 11% growth in recurring revenue year-over-year[1][2].
Financially, Idexx reported Q2 2026 revenue of $1.22 billion, nearly 10% higher than the prior year and exceeding forecasts by $16 million. Non-GAAP earnings per share (EPS) were $4.27, beating last year by 64 cents and analyst estimates by 34 cents per share. The company ended the quarter with $197 million in cash and liquid assets[1][2].
Goldman analyst Matt Dellatorre gives multiple reasons for optimism on Idexx. He highlights momentum across platforms, promising new diagnostic instrument launches (like the Multi-Q Dx expected in January 2027), ongoing development of software and AI features, and strong operational execution. Dellatorre rates Idexx a Buy with a $740 price target, implying roughly 34% upside in the next 12 months. Analyst consensus leans moderately bullish, with 6 Buys and 4 Holds among the past 10 ratings, and an average target price around $711 versus a trading price near $553[1][2].
Zeta Global: AI-Driven Marketing Technology Growth
Zeta Global Holdings is a marketing technology company specializing in AI-enhanced customer data platforms and consumer intelligence. Its flagship product, the Zeta Marketing Platform (ZMP), leverages AI to analyze vast amounts of consumer data for enhanced marketing campaign targeting, automation, and measurement. The company also offers the Zeta Data Cloud, one of the largest industry data repositories, and Athena, an enterprise intelligence operating system powered by agentic AI[1][2].
As enterprises seek more sophisticated, AI-powered marketing tools to improve consumer engagement and maximize advertising ROI, demand for Zeta’s solutions grows. The addressable market for AI-driven marketing and customer data platforms is increasing. Zeta’s subscription-based business model provides a stable foundation of recurring revenue[1][2].
In its Q2 2026 earnings, Zeta reported nearly $443 million in revenue, representing a 43% year-over-year increase and exceeding forecasts by more than $22 million. GAAP income was $8 million, generating EPS of $0.03, beating estimates by 6 cents[1][2].
Goldman analyst Callie Valenti views Zeta as a differentiated platform poised to gain share from legacy marketing solutions as enterprises consolidate software spending and increase AI investments. Key drivers include improvements from recent mergers and acquisitions enhancing the Data Cloud and AI capabilities and an upswing in partnership opportunities, notably with Palantir. Valenti assigns Zeta a Buy rating with a $45 price target, suggesting about 32% upside over the next year. The analyst consensus strongly favors Buy ratings (12 out of 14 recent reviews) with an average price target of about $37.25, compared to a current price near $34[1][2].
Implications for Investors
Goldman Sachs’ updated market outlook reflects a nuanced environment where investors should prioritize companies with secular growth profiles capable of sustaining earnings momentum even with slower economic growth. Idexx and Zeta exemplify this strategy as leaders in their sectors that capitalize on enduring shifts—whether in pet care and diagnostics or AI-enabled marketing technology.
Both stocks show strong recent financial results, robust revenue growth, and promising catalysts such as product launches and strategic partnerships that may drive further upside. Their recurring revenue business models add stability amid market uncertainties.
Investors considering exposure to growth opportunities in Q4 2026 and beyond may find these stocks aligned with the evolving investment landscape favored by Goldman Sachs.[1][2]
Disclaimer: The above analysis is based on publicly available information from Yahoo Finance and TipRanks as of October 22, 2026. This article is intended for informational purposes only and not as investment advice. Investors should perform their own due diligence before making decisions.
Sources
- Goldman Sachs Sees a Shift in the Stock Market — and Names 2 Stocks to Buy Now
- Goldman Sachs Sees a Shift in the Stock Market — and Names 2 Stocks to Buy Now – TipRanks.com
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