Goldman Sachs Soars After Crushing Wall Street Estimates

Goldman Sachs

Goldman Sachs Group Inc (NYSE:GS)

Wall Street has welcomed upbeat fourth-quarter financial results from U.S. banking giant Goldman Sachs Group Inc. early Wednesday. Shares of the company ran up 2.5% before the opening bell to change hands at $184.33 apiece. The stock extended the gains, adding $7.57, or 4.21% to $187.48 as of 9:45 a.m. in New York.

GS Earnings & Outlook

The bank reported a profit of $2.54 billion, or $6.04 per share, up from $5.68 per share, in the same period last year. Excluding the effect of the 2017 tax-law overhaul, Goldman Sachs earned $4.83 per share.

Total revenue during the three months to December 31, 2018 came to $8.1 billion, compared with $7.83 billion in the same three months a year ago. Analysts surveyed by Refinitiv expected the bank to come out with earnings of $1.64 billion, or $4.27 per share on revenue of $7.55 billion.

Institution Client Services revenue rose 2% from Q4 2017 to $2.43 billion, while Investment Banking revenue slumped 5% to $2.04 billion. Investment Management revenue of $1.70 billion grew 2% from Q4 2017, while Investing & Lending generated revenue of $1.91 billion down, which is a decline of 2% from the prior-year period.

Revenue from underwriting of bonds, stocks, and other securities declined 38% from the year-ago period as corporate executives chose to shelve offerings due to volatile markets. The bank said fixed income trading revenue declined 18 percent from the earlier-year quarter, the biggest drop since 2008.

Goldman Sachs CEO Comments

David Solomon, Chief Executive Officer of the bank said had this to say in the company’s earnings statement, “We are pleased with our performance for the year, achieving stronger top and bottom line results despite a challenging backdrop for our market-making businesses in the second half. We are confident that we are well positioned to support an even larger universe of clients, continue to diversify our revenue mix and deliver strong returns for our shareholders in the years ahead.”

Goldman Sachs Group, Inc. Profile

Goldman Sachs Group, Inc. engages in global investment banking, securities, and investment management, which provides financial services. It operates through the following business segments: Investment Banking, Institutional Client Services, Investing and Lending, and Investment Management. The Investment Banking segment gives financial advisory services and help companies raise capital.

The Institutional Client Services segment serves clients who come to buy and sell financial products, raise funding, and manage risk. The Investing and Lending segment includes investing and relationship lending activities; and making investment. The Investment Management segment involves in investment and wealth advisory services. The company was founded by Marcus Goldman in 1869 and is headquartered in New York, NY. – CNN Money