Goldman Sachs' Strong Q2 Performance Boosts Confidence in Future Returns, Says JP Morgan Analyst

Benzinga07-16

JP Morgan analyst Kian Abouhossein presented their take on The Goldman Sachs Group, Inc. (NYSE:GS) second-quarter FY24 earnings results reported today.

The bank reported revenue of $12.730 billion, beating the consensus of $12.456 billion, and GAAP EPS of $8.62, beating the consensus of $8.35.

The analyst stated that Goldman Sachs’ reported EPS of $8.62 is 5% above their estimate of $8.24. The bank’s $3.5 billion share buyback during the quarter significantly exceeded JPMorgan’s $1 billion, the analyst noted.

Abouhossein added that despite the buyback occurring before the Fed Stress Test results, which raised the SCB by 90bps to 6.4% and set a 13.9% Standardized CET1 ratio requirement from October 2024, strong earnings generation offers confidence in future capital returns.

However, uncertainty remains regarding the finalization of Basel 3 regulations, noted the analyst.

Abouhossein anticipates low-single-digit EPS upgrades to consensus for 2024. The analyst has rated the stock Overweight.

Investors can gain exposure to the stock via IShares U.S. Broker-Dealers & Securities Exchanges ETF (NYSE:IAI) and Invesco KBW Bank ETF (NASDAQ:KBWB).

Also Read: Goldman Sachs Targets Asia’s Fast-Growing Economies With New $2B Private Equity Fund: Report

Price Action: GS shares are up 1.22% at $485.73 at the last check Monday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

Photo via Shutterstock

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