Nomura Reiterates “Positive” Rating for Goldman Sachs (GS)
The analysts wrote, “While GS shares have underperformed YTD, recent discussions suggest that positive sentiment is building. Despite revenue headwinds in some core businesses, growing contribution from higher-multiple segments, coupled with future sources of capital relief, should help drive value. “We have been more cautious on the shares given “bindingness” concerns, ie, that the recently proposed Supplementary Leverage Ratio (SLR) will become the binding capital constraint for GS, dampening long-term ROE potential. However, there are additional capital/earnings levers which could meaningfully improve GS’s ROE profile, prompting our scenario analysis within. Findings indicate the most likely path (deleveraging) could yield as much as a +100-200bp ROE uplift, or 7-14% upside vs our current TP ($156). However, even if such actions are taken, valuation approach supports a Neutral rating.”
Goldman Sachs (NYSE:GS) traded up 1.23% during mid-day trading on Tuesday, hitting $167.89. 947,361 shares of the company’s stock traded hands. Goldman Sachs has a 1-year low of $148.71 and a 1-year high of $181.13. The stock’s 50-day moving average is $160.3 and its 200-day moving average is $165.5. The company has a market cap of $78.035 billion and a price-to-earnings ratio of 10.93.
Goldman Sachs (NYSE:GS) last posted its quarterly earnings results on Thursday, April 17th. The company reported $4.02 EPS for the quarter, beating the Thomson Reuters consensus estimate of $3.44 by $0.58. The company had revenue of $9.33 billion for the quarter, compared to the consensus estimate of $8.70 billion. During the same quarter in the prior year, the company posted $4.29 earnings per share. The company’s quarterly revenue was down 7.5% on a year-over-year basis. Analysts expect that Goldman Sachs will post $15.52 EPS for the current fiscal year.
Several other analysts have also recently commented on the stock. Analysts at Buckingham Research upgraded shares of Goldman Sachs to a “buy” rating in a research note on Thursday, June 12th. Separately, analysts at Zacks reiterated a “neutral” rating on shares of Goldman Sachs in a research note on Monday, June 9th. They now have a $174.00 price target on the stock. Finally, analysts at SunTrust reiterated a “neutral” rating on shares of Goldman Sachs in a research note on Friday, April 25th. They now have a $176.00 price target on the stock. One equities research analyst has rated the stock with a sell rating, nine have issued a hold rating and eight have assigned a buy rating to the company’s stock. Goldman Sachs has a consensus rating of “Hold” and an average target price of $174.41.
The Goldman Sachs Group, Inc (NYSE:GS), is a global investment banking, securities and investment management firm that provides a range of financial services to a substantial and diversified client base that includes corporations, financial institutions, governments and high-net-worth individuals.
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