top of page

Goldman Sachs ready to run?

It’s time to talk about $GS otherwise known as Goldman Sachs.

Current Price: $214.50

52/Wk High: $250.46

52/Wk Low: $130.85

Read below for the breakdown!

Goldman Sachs, one of the best banks around has blown away Wall Street of late after their massive beat off the top and bottom line expectations. The historic bank has traded far below its highs of the year flashing opportunity.

Beginning the year with the COVID-19 pandemic plunged banks and Goldman Sachs was not left out of the pain. The stock still trades far under its highs and with the recent beat and out look, it seems like a possibly good investment while it's undervalued.

At the end of the day if Goldman Sachs can make it through the heart of the COVID-19 crisis then most likely it can survive the rest. Given the typical volatility that has consistently come with $GS, an increase in the share price would not be a surprising move after the beat in the coming weeks.

The stock also trades considerably below its current book value of $227.31/share, which is very much attractive.

Getting into the numbers $GS reported a massive Q2 beat. Goldman Sachs reported a whopping $6.26 EPS versus the expected $3.79 EPS consensus. Not only that but $GS also reported a huge $13.3 billion revenue, which gained 40.5% YOY.

$GS positioned itself well in the case of credit loss. Goldman Sachs reported provision credit losses at $1.59 billion. While this can be seen as a major negative due to the expected loss, it should also be seen as a comfort that the bank is taking proper precautions.

Furthermore Goldman maintained a solid annual dividend of $5.00 and a yield of 2.31%.

Given the terrific earnings $GS got several price target updates. The stock was upgraded by several analysts. The stock gained seven price target increases with Oppenheimer raising their PT to $355/share and BMO Capital Markets raising theirs to $279/share.

Overall analysts are quite bullish on Goldman Sachs. Currently the average price target is $245.00/share representing a 14.13% upside. Secondly the high price target is $355/share and low is $192/share. 

The big money is also quite bullish. Currently 67.68% of the stock is owned by institutions. Top holders include Black Rock, Capital International, and Dodge & Cox.

Overall I like $GS and its mid term outlook. I think given the beat and the mixed but positive forecast for the future, along with the price target upgrades I think the stock should and will run.

While I do not like buying high I did add to my position right at the current trading range of $214/share and am bullish on the stock mid to long term. I think a respectable mid term target is anywhere between $225/share and $230/share. 


Disclaimer: This is not direct financial advice, simply opinion based on independent research.

bottom of page