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Goldman Sachs (GS) Suffers a Larger Drop Than the General Market: Key Insights

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In the latest trading session, Goldman Sachs (GS - Free Report) closed at $614.91, marking a -1.79% move from the previous day. The stock fell short of the S&P 500, which registered a loss of 0.47% for the day. Meanwhile, the Dow experienced a rise of 0.37%, and the technology-dominated Nasdaq saw a decrease of 1.35%.

Prior to today's trading, shares of the investment bank had lost 1.13% over the past month. This has lagged the Finance sector's loss of 0.21% and was narrower than the S&P 500's loss of 1.78% in that time.

Investors will be eagerly watching for the performance of Goldman Sachs in its upcoming earnings disclosure. The company is predicted to post an EPS of $12.64, indicating a 9.15% growth compared to the equivalent quarter last year. Simultaneously, our latest consensus estimate expects the revenue to be $15.28 billion, showing a 7.5% escalation compared to the year-ago quarter.

In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $47.12 per share and a revenue of $57.64 billion, indicating changes of +16.23% and +7.71%, respectively, from the former year.

Any recent changes to analyst estimates for Goldman Sachs should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 0.03% increase. At present, Goldman Sachs boasts a Zacks Rank of #1 (Strong Buy).

Valuation is also important, so investors should note that Goldman Sachs has a Forward P/E ratio of 13.29 right now. Its industry sports an average Forward P/E of 14, so one might conclude that Goldman Sachs is trading at a discount comparatively.

It is also worth noting that GS currently has a PEG ratio of 0.87. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Financial - Investment Bank industry had an average PEG ratio of 1.15 as trading concluded yesterday.

The Financial - Investment Bank industry is part of the Finance sector. This industry currently has a Zacks Industry Rank of 3, which puts it in the top 2% of all 250+ industries.

The Zacks Industry Rank evaluates the power of our distinct industry groups by determining the average Zacks Rank of the individual stocks forming the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.


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