Goldman Sachs' Core Business Strength And Future EPS Growth Has Upside, Analyst Says After Q3 Performance

J.P. Morgan analyst Kian Abouhossein expressed the view on Goldman Sachs Group Inc.‘s (NYSE:GS) third quarter financial results.

Today, the company reported revenue of $12.70 billion, beating the consensus of $11.87 billion, and EPS of $8.40, beating the consensus of $7.03.

In the conference call, CEO David Solomon highlighted strong client demand and a rising deal backlog and expects alternative fundraising to exceed $60 billion in 2024.

He noted the firm remained below 10-year averages for equity and M&A volumes and stressed the need to enhance margins in asset and wealth management.

Solomon also mentioned that the direction of travel at this point is “back to the core business.”

On the other hand, Goldman’s CFO stated that the General Motors credit card partnership transfer is expected to close in the third quarter of 2025.

J.P. Morgan analyst, with an Overweight rating, writes that GS’s results are strong relative to the cautious guidance provided at the recent September Financials conference. Notably, Equity S&T revenues reached $3.5 billion, significantly outperforming peers reported so far, with a substantial ongoing margin, adds the analyst.

Goldman Sachs has shown strength in its core franchises, and Abouhossein anticipates its shares will outperform peers.

The analyst anticipates low single-digit percentage upgrades to the consensus EPS for 2024.

Investors can gain exposure to the stock via Shares U.S. Broker-Dealers & Securities Exchanges ETF (NYSE:IAI) and Global X Funds Global X Dow 30 Covered Call ETF (NYSE:DJIA).

Price Action: GS shares are down 0.55% at $519.90 at the last check Tuesday.

Photo via Shutterstock

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