Is Goldman Sachs Stock Still a Buy After Earnings?

Goldman Sachs signage on building door — (Image credit: Bloomberg/Getty Images)

Goldman Sachs (GS) stock jumped more than 3% at Tuesday's open after the investment banking giant disclosed its third-quarter results, but was last seen in negative territory.

In the quarter ended September 30, Goldman's net revenue increased 7.5% year-over-year to $12.7 billion, led by a 16.2% surge in revenue in its Asset & Wealth Management segment to $3.8 billion. The company also said earnings per share (EPS) were up 53.6% from the year-ago period to $8.40.

"Our performance demonstrates the strength of our world-class franchise in an improving operating environment," said Goldman Sachs CEO David Solomon in a statement. "We continue to lean into our strengths – exceptional talent, execution capabilities and risk management expertise – allowing us to effectively serve our clients against a complex backdrop and deliver for shareholders."

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The results crushed analysts expectations. Wall Street was anticipating revenue of $11.8 billion and earnings of $6.89 per share, according to Yahoo Finance.

Goldman also proudly noted that its Assets Under Supervision (AUS) reached a record $3.1 trillion, an increase of 15.8% over the year-ago period.

Is Goldman Sachs stock a buy, sell or hold?

Goldman Sachs has been one of the best Dow Jones stocks on the price charts this year, up 38.1% on a total return basis (price change plus dividends) through the October 14 close. Unsurprisingly, Wall Street is very bullish on the financial stock. According to S&P Global Market Intelligence, the consensus recommendation among analysts it tracks is a Buy.

However, analysts' price targets have struggled to keep up with the stock's outperformance in 2024. Currently, the average price target on GS is $526.63, which is a discount to where the blue chip stock is trading at the time of this writing. Price-target hikes could come down the pike if shares keep climbing.

"Goldman Sachs is poised for a 2024 recovery in investment banking from the market trough in 2023, which would benefit GS as the global leader," wrote CFRA Research analyst Kenneth Leon in an October 4 note. "A revamped strategy to focus on core businesses and drive more durable, recurring fee revenue is underway in Asset & Wealth Management."

Leon went on to note that his firm sees Goldman Sachs benefitting from an upturn in transaction fee activities and private equity funds exiting investments through initial public offerings.

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Joey Solitro is a freelance financial journalist at Kiplinger with more than a decade of experience. A longtime equity analyst, Joey has covered a range of industries for media outlets including The Motley Fool, Seeking Alpha, Market Realist, and TipRanks. Joey holds a bachelor's degree in business administration.