Banking & Finance

Goldman Sachs Trips Over the Bottom Line

Chris Lange

Goldman Sachs Group Inc. (NYSE: GS) reported its most recent quarterly results before the markets opened on Tuesday. The investment house said that it had $4.79 in earnings per share (EPS) and $8.32 billion in revenue. That compares with consensus estimates of $4.81 in EPS and $8.31 billion in revenue, as well as the $6.28 per share and $8.65 billion posted in the same period of last year.

During the latest quarter, Investing & Lending net revenues included record quarterly net interest income in debt securities and loans of $891 million.

Also, Investment Management net revenues included record quarterly management and other fees of $1.46 billion. Assets under supervision increased $102 billion during the quarter to a record $1.76 trillion.

Book value per common share was $218.82, 2.2% higher compared with the end of the second quarter of 2019. This is 10.9% higher compared with the end of the third quarter of 2018.

In terms of its segments, the firm reported as follows:

  • Investment Banking revenues decreased 15% year over year to $1.69 billion.
  • Institutional Client Services revenues increased by 6% to $3.29 billion.
  • Investing & Lending revenues decreased by 17% to $1.68 billion.
  • Investment Management decreased 2% to $1.67 billion.

David Solomon, board chair and chief executive, commented:

Our results through the third quarter reflect the underlying strength of our global client franchise and its ability to produce solid results in the context of a mixed operating environment. We continue to execute on our strategic priorities, including investing in important growth opportunities in our existing and new businesses and in delivering for our clients in the most efficient and effective manner possible. We believe that this focus will best position the firm to generate long-term, industry-leading returns for our shareholders.

Shares of Goldman Sachs traded down 3% early Tuesday at $199.50, in a 52-week range of $151.70 to $234.06. The consensus price target is $234.95.