Finally, Goldman Sachs is due to report its first quarter earnings on Monday, April 19, just before the market opens. Wall Street analysts are just as excitedly expecting blockbuster results. The fiscal juggernaut’s stock has tanked 14% in market capitalization this year, as of Friday. This period of decline creates a climate of guarded hope heading into the earnings report.
According to Zacks investment research, analysts are expecting Goldman to post EPS of $12.35, as well as revenue of about $14.81 billion. These numbers put the bank on very competitive footing as it gets ready to release some of its performance metrics in coming weeks. Following the earnings release, Goldman Sachs will host a conference call for analysts at 9:30 a.m. ET to discuss the results and insights into its operations.
Of the big banks, Goldman Sachs has been the biggest beneficiary of the recent market environment, which has favorized equities trading. Competitors JPMorgan Chase and Morgan Stanley just last week reported excellent first-quarter earnings, thanks to surging equities trading profits. JPMorgan Chase just came in with a blindingly good 48% increase in equities trading revenue. By comparison, Morgan Stanley recorded a respectable 45% jump. Those results have raised the bar for Goldman Sachs to produce the same sort of jaw-dropping performance.
The bank’s wealth and asset management division has been touted as the firm’s key growth engine by CEO David Solomon. This division has shown remarkable growth and resilience through adversity. It’s been a key driver of increasing Goldman Sachs’ revenues, even in volatile down/up markets. In the last reporting period, Goldman Sachs had record revenue. They took $4.56 billion of that from fixed income and $3.65 billion from equities, underlining the variety of their revenue sources that add layers to financial security.
The financial community is still trying to find their way through these unprecedented economic times. Goldman Sachs then needs to go on to beat Wall Street on the expectation. Only time will tell the next earnings report will tell how well this bank is running. More importantly, though, it’ll show its talent for rolling with the market’s shifting tides.
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