CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
We think GS is an attractive constituent in the financial sector given our view of a rebound in the capital markets, and the firm’s franchise strength in asset management. We raise our target by $20 to $450 using a forward P/E of 11.8x, a wider risk premium than the three-year historic average at 10.4x. We lift our 2024 EPS estimate by $3.60 to $38.00 and 2025’s by $2.15. GS posted Q1 EPS of $11.58, $2.94 above consensus, and revenue rose 16% Y/Y. Our revenue forecast is $51.8B in 2024 and $53.9B in 2025. Global Banking & Markets (18% ROE) delivered 15% Y/Y revenue growth, with significantly higher debt underwriting (+38% Y/Y), equity underwriting (+45%), and advisory (+24%). Outsize growth in the segment was seen in both equities and FICC financing. Asset & Wealth Management (9.9% ROE) did +18% revenue growth, with $2.85T assets under supervision. Asset class categories with significantly higher growth were private banking and lending (+93% Y/Y), incentive fees (+66%), and equity investments (+87%).