Published: Wed, April 19, 2017
Money | By Oscar Reynolds

Stock trading actively: The Goldman Sachs Group, Inc. (GS)

Stock trading actively: The Goldman Sachs Group, Inc. (GS)

Goldman Sachs (GS), the New York-based investment bank, said net income nearly doubled during the first quarter as buoyant markets led more companies to sell bonds and stocks, providing a bounty of fees.

For the first quarter, Goldman Sachs posted earnings of $5.15 per share. Israel Discount Bank of New York GFN bought a new position in Goldman Sachs Group during the fourth quarter valued at $158,000.

Bank of America reported earnings of 41 cents per share on $22.2 billion in revenue, compared to the analyst estimates of 35 cents per share and $21.6 billion in revenue.

The investment bank posted revenue of $8.03 billion in the period. While this was almost double that of the year-ago quarter, it fell well-below our Zacks Consensus Estimate of $5.38 per share.

Revenue from fixed income, commodities and currency trading was up 1.2% to end the quarter at $1.18 billion excluding adjustments for accounting. Finally, Barclays PLC boosted their target price on shares of Goldman Sachs Group from $210.00 to $262.00 and gave the stock an "equal weight" rating in a report on Tuesday, January 3rd.

Puzzled analysts asked a number of FICC-related questions on Goldman Sachs' conference call, hoping to get a better explanation as to why the investment bank seemingly lost ground against its peers in the first quarter. C, -1.07% which reported healthy quarterly results last week, both boasted a 17% increase in profit on the back of their trading operations.

According to the Recommendation Trends of the stock polled by Zacks Investment Research for this month, the company has a consensus recommendation of 2.24 out of the scale from 1 to 5, where 1 stands for Strong Buy and 5 means Strong Sell.

Analysts surveyed by Bloomberg estimated $2.03 billion. During the same period in the prior year, the business earned $4.68 EPS. The first quarter of 2016 was the weakest start to the year for the firm since before the financial crisis.

Morgan Stanley, Goldman's traditional rival, reports earnings tomorrow.

"Trading businesses should be measured not so much on quarterly numbers but how well they serve clients", said Mike Mattioli, a portfolio manager at Manulife Asset Management, which holds shares in Goldman.

Net revenues from bond, currency and commodities trading was little changed from the same period a year ago at $1.69 billion. Net revenues from underwriting were 37 percent higher year-over-year, at $947 million, which Goldman Sachs attributes to an increase in industry-wide activity, and significantly higher net revenues in debt underwriting.

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