Goldman Sachs Poised for Impressive Q4 Earnings as Stock Surges
With a market cap of $179.8 billion, The Goldman Sachs Group, Inc. (GS) stands as a top global financial holding company. Headquartered in New York, this capital markets leader offers diverse services to corporations, institutions, governments, and individuals. The company operates in three main areas: Global Banking & Markets, Asset & Wealth Management, and Platform Solutions. Goldman Sachs is expected to announce its Q4 earnings before the market opens on Wednesday, January 15.
Analysts Anticipate Significant Profit Growth
Analysts predict that Goldman will report an adjusted profit of $7.94 per share, marking a substantial increase of 44.9% from $5.48 per share in the corresponding quarter last year. Notably, Goldman has consistently surpassed analysts’ earnings expectations for the past four quarters. For the last reported quarter, the adjusted earnings per share (EPS) shot up by 53.6% year-over-year to $8.40, exceeding estimates by 22.6%.
Future Projections for Earnings Show Strong Growth
Looking ahead to fiscal 2024, forecasts suggest an adjusted EPS of $37.05, which signifies a remarkable 62% rise from $22.87 in fiscal 2023. By fiscal 2025, adjusted EPS is expected to climb further by 16.2% year-over-year to $43.04.
Goldman Sachs Stock Outshines Competitors
Over the past year, GS stock has surged by 48.4%, significantly outpacing the S&P 500 Index’s ($SPX) 23.3% return and the Financial Select Sector SPDR Fund’s (XLF) 28.5% gain during the same span.
Mixed Q3 Results and Their Impact
Goldman Sachs’ stock remained relatively unchanged following the release of its mixed Q3 results on October 15. The firm continued to see strong growth in its investment banking and management sectors, driven by impressive advisory and underwriting performances, along with record net revenues in fixed income. However, the company experienced a 19.2% decline in market-making revenues to $4 billion, resulting in a 1.9% overall dip in total non-interest revenues to $10.1 billion. In contrast, net interest income grew significantly, soaring 69.6% to $2.6 billion and yielding a 7.5% increase in total net revenue to $12.7 billion.
Goldman also demonstrated solid expense management, lowering total operating expenses by 8.2% year-over-year to $8.3 billion, which improved profitability and contributed to a striking 47.7% increase in GAAP net earnings, reaching $2.8 billion.
Analyst Sentiment Reflects Optimism
The consensus for GS stock is moderately positive, boasting an overall “Moderate Buy” rating. Out of 22 analysts tracking the stock, 13 suggest a “Strong Buy,” 1 recommends a “Moderate Buy,” and 8 offer a “Hold” rating. The average price target of $605 indicates a modest upside potential of 5.7% from current price levels.
On the date of publication, Aditya Sarawgi did not hold any positions in the securities mentioned in this article. All information is for informational purposes only. Please review the Barchart Disclosure Policy for more details.
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.