Nomura Securities Maintains a 'Buy' on Goldman Sachs (GS); 4Q Review
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Price: $1,039.42 -0.31%
Rating Summary:
16 Buy, 23 Hold, 2 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
Rating Summary:
16 Buy, 23 Hold, 2 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 13 | Down: 14 | New: 11
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Nomura Securities maintains a 'Buy' on Goldman Sachs (NYSE: GS) price target of $130.00.
Analyst, Glenn Schorr, said, "GS reported EPS of $1.84 vs. our/Street estimates of $1.00/$1.28. The beat was driven by a positive $872mn of revenues in Investing & Lending, a 10% q/q increase in investment banking revenues, solid expense control (non-comp -5% q/q), and a lower than expected 19% tax rate (+$0.25 to EPS compared with a more “normal” 30% tax rate). However, like peers, Goldman posted weak trading results (clean FICC - 5% from a low 3Q11 and total equities -22% ex DVA) in the midst of a very challenging capital markets backdrop. In addition, Goldman’s asset management business saw significant outflows ($21bn of net long-term outflows, a 14% annualized decay rate). Adding it all up, Goldman posted a lackluster 5.8% ROE (5.9% for full year 2011 ex the Berkshire preferred buyback), even with a 36.5% comp ratio for the quarter. We expect 1H2012 to be choppy for capital markets activity (Europe remains an overhang) and we brought our 2012E EPS to $11.00 from $11.50. That said, Goldman looks inexpensive (0.9x tangible book) and we see attractive upside over the next 12 months as capital markets activity could surprise to the upside and ROEs could climb back to the double-digits."
For an analyst ratings summary and ratings history on Goldman Sachs click here. For more ratings news on Goldman Sachs click here.
Shares of Goldman Sachs closed at $104.31 yesterday.
Analyst, Glenn Schorr, said, "GS reported EPS of $1.84 vs. our/Street estimates of $1.00/$1.28. The beat was driven by a positive $872mn of revenues in Investing & Lending, a 10% q/q increase in investment banking revenues, solid expense control (non-comp -5% q/q), and a lower than expected 19% tax rate (+$0.25 to EPS compared with a more “normal” 30% tax rate). However, like peers, Goldman posted weak trading results (clean FICC - 5% from a low 3Q11 and total equities -22% ex DVA) in the midst of a very challenging capital markets backdrop. In addition, Goldman’s asset management business saw significant outflows ($21bn of net long-term outflows, a 14% annualized decay rate). Adding it all up, Goldman posted a lackluster 5.8% ROE (5.9% for full year 2011 ex the Berkshire preferred buyback), even with a 36.5% comp ratio for the quarter. We expect 1H2012 to be choppy for capital markets activity (Europe remains an overhang) and we brought our 2012E EPS to $11.00 from $11.50. That said, Goldman looks inexpensive (0.9x tangible book) and we see attractive upside over the next 12 months as capital markets activity could surprise to the upside and ROEs could climb back to the double-digits."
For an analyst ratings summary and ratings history on Goldman Sachs click here. For more ratings news on Goldman Sachs click here.
Shares of Goldman Sachs closed at $104.31 yesterday.
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