Goldman (GS) Shares Slightly Lower Amid Downgrade from ISI Group

An analyst at ISI Group, Ed Najarian, downgraded shares of Goldman Sachs (NYSE: GS) from Buy to Hold Thursday morning. The firm's price target was reduced from $153 to $135.

The ISI analyst believes Goldman will report "very weak" results during the second half of this year, especially during the third quarter. The analyst expects "significant" revisions to earnings expectations over the next month.

Najarian believes Goldman will have trouble getting over 1x tangible book value per share. The stock currently trades at around 0.96x book value.

The analyst made the following earnings estimate reductions (on average, cut by about 33 percent):

• Q3 from $2.50 to $0.75, vs. the current Street estimate of $2.79
  
• Q4 from $4.16 to $2.40, vs. cons. $4.51
  
• FY12 from $17 to $15.25, vs. cons. $16.50
  
• FY13 from $15.25 to $13.50, vs. cons. $18.13.

With shares of Goldman Sachs down about 0.5 percent to around $115.60 in pre-market action, ISI's new price target still represents potential upside of about 17 percent.

For more ratings news on Goldman Sachs click here and for the rating history of Goldman Sachs click here.

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