Goldman Sachs Group Inc (GS)

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Earnings Preview: Goldman Sachs Group Inc. (NYSE: GS)
By: 24/7 Wall St. | July 17, 2023

• Before U.S. markets open on Wednesday, these five companies are on tap to report quarterly results.

Goldman Sachs

Goldman Sachs Group Inc. (NYSE: GS) is not expected to have much good news to reveal in its second-quarter earnings report. The sharp drop in mergers and acquisitions hits Goldman’s investment banking business especially hard, and trading revenue likely will be lower than in the first quarter as well. Add to that writedowns for acquisitions and real estate loan losses, and the forecast weakens even more.

About the best the bank will be able to do is manufacture a bitter pill that includes all the bad news and declare that it is all in the rearview mirror and the future is so bright you gotta wear shares.

Of the 25 analysts covering the stock, 16 have a rating of Buy or Strong Buy and eight more have Hold ratings. At a share price of around $326.00, the upside potential based on a median price target of $380.00 is 16.6%. At the high price target of $450.00, the implied upside is 38%.

Second-quarter revenue is forecast to come in at $110.73 billion, down 12.2% sequentially and a drop of 9.5% year over year. Adjusted EPS are forecast at $4.04, down 54.2% sequentially and 47.7% lower year over year. Estimates for the 2023 fiscal year call for revenue of $46.14 billion, down 2.6%, and EPS of $27.48, down 8.6%.

The stock trades at 11.9 times expected 2023 EPS, 8.9 times estimated 2024 earnings of $36.51 and 8.0 times estimated 2025 earnings of $40.93 per share. The 52-week trading range is $285.15 to $389.58. Goldman Sachs pays an annual dividend of $10.00 (yield of 3.07%). Total shareholder return for the past 12 months was 19.22%.

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