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Should You Buy Goldman Stock as Macro Clarity Rekindles Dealmaking?
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Key Takeaways
Goldman is poised to benefit as U.S. dealmaking rebounds after early-2025 macro and tariff uncertainty.
GS led the global mergers and acquisitions ranking in 2025, hitting $1.66 trillion in deal volume.
Goldman's advisory fees rose 31% in the first nine months of 2025, lifting total IB fees 19%
U.S. dealmaking activity was muted in early 2025 as macroeconomic uncertainty and tariff-related concerns weighed on corporate and private equity decision-making. However, momentum has strengthened in the second half of 2025 and is expected to continue in 2026, supported by improved economic clarity and rising optimism among private equity firms. Hence, the well-known investment bank, Goldman Sachs (GS - Free Report) , is in the spotlight.
Private equity sentiment has rebounded sharply, according to a Citizens Financial survey. While only 48% of private equity leaders felt confident pursuing mergers and acquisitions (M&A) in the first quarter of 2025, confidence surged to 86% by the year-end. Nearly 69% of respondents now describe the M&A environment as strong, and 90% expect deal activity to increase or remain steady.
Looking forward, dealmaking is likely to favor execution-driven strategies, such as carve-outs, de-conglomeration, and buy-and-build transactions over large, transformational deals. This back-to-basics focus will likely lift mid-market activity through smaller, synergy-rich add-ons and faster tech integration. With solid GDP growth and a potential Federal Reserve rate cut, financing conditions are improving, and strategic activity will continue rising.
Against this backdrop, GS stands out as a key beneficiary. Goldman, historically one of the world’s leading M&A advisors, is poised to capture a disproportionate share of advisory fees. The firm topped global M&A rankings in 2025 by hitting $1.66 trillion in volume, advising on 40 megadeals and achieving a market share of 36.4%, followed by JPMorgan (JPM - Free Report) and Morgan Stanley (MS - Free Report) , according to ION Analytics data.
Financial results and management commentary reinforce this outlook. In the first nine months of 2025, Goldman’s M&A advisory fees rose 31% year over year to $3.37 billion, while equity and debt underwriting revenues increased 7% and 11%, driving a 19% rise in total investment banking (IB) fees. Similarly, JPMorgan IB fees rose 12% year over year, while Morgan Stanley's IB revenues increased 15% from the prior-year period in the first nine months of 2025. With a growing M&A pipeline, rising initial public offering activity, and strong advisory backlog, Goldman, JPM, and MS appear well-positioned to sustain solid investment banking performance into 2026.
Other Growth Catalysts for Goldman in 2026
Strategic Streamlining Progresses Well: The company’s streamlining efforts have been underway for some time as it retreats from the underperforming consumer banking ventures. Under CEO David Solomon, the company has embarked on a deliberate transformation to exit non-core consumer banking and double down on the divisions where Goldman maintains a clear competitive advantage.
In sync with its restructuring efforts, in November 2025, Goldman reached an agreement with ING Bank Slaski to divest its Polish asset management firm, TFI. The deal is targeted for completion in the first half of 2026. In the third quarter of 2025, Goldman completed the sale of its GM credit card business to Barclays. In 2024, Goldman completed the sale of GreenSky. In 2023, it sold its Personal Financial Management unit to Creative Planning and also sold all of Marcus’s loan portfolio, part of its broader retreat from consumer banking.
These moves demonstrate a well-thought-out exit, allowing the company to reallocate capital and attention toward higher-margin, more scalable businesses like Global Banking and Markets and the asset and wealth management (AWM) divisions. The benefits of business restructuring began to show in the numbers. The Global Banking and Markets segment’s net revenues rose 17% year over year in the first nine months of 2025, while the AWM division’s net revenues rose 4% year over year, reflecting growing fee income and strength in private credit. In December 2025, GS agreed to acquire Innovator Capital Management, a leading provider of defined outcome exchange-traded funds (ETFs). The transaction significantly expands Goldman’s active ETF capabilities and is part of a broader pivot toward building “durable revenue streams” through diversified AWM offerings.
Betting Big on Private Equity to Aid Growth: The company is aggressively expanding its private equity and alternatives business through acquisitions, platform enhancements and the integration of new investment capabilities, which will likely support its growth over the long run.
In sync with this, in October 2025, Goldman agreed to acquire Industry Ventures, a leading venture capital platform that invests across all stages of the venture capital lifecycle. The planned acquisition of Industry Ventures underscores Goldman’s intent to strengthen its position in private markets and expand access to high-growth technology companies for clients globally.
In September 2025, GS partnered with T. Rowe Price in a $1-billion deal to co-develop retirement and wealth products. Later, the firms expanded the partnership to roll out alternative investment offerings for wealthy clients in 2025 and retirement savers in 2026. In January 2025, the company launched initiatives to grow private credit and other asset classes, including forming the Capital Solutions Group and expanding its alternatives team.
Goldman is expanding its private equity credit services internationally, focusing on Europe, the U.K. and Asia. The company's Asset Management unit intends to expand its private credit portfolio to $300 billion by 2029.
Scaling AI to Transform Business: GS is executing a firmwide artificial intelligence (AI) transformation that spans trading, investment banking, asset management and internal productivity, with a clear objective — to lift fee income and expand operating leverage over the coming years. At the center of this effort are the “One Goldman Sachs 3.0 (OneGS 3.0)” transformation and the “GS AI Assistant” program, both designed to embed generative and predictive AI into nearly every major workflow across the firm.
At the 2025 Goldman Global Conference, CFO Denis Coleman described OneGS 3.0 as a multi-year overhaul that embeds AI as a core operating capability rather than a standalone tool. The initiative focuses on simplifying processes, boosting productivity and enabling scalable growth, supported by high-quality data, shared platforms and modern infrastructure. Coleman emphasized that this foundation allows Goldman to deploy AI responsibly while meeting stringent regulatory and risk-management standards.
In parallel, the firm is reshaping its front-office strategy, recently reorganizing its TMT investment banking division to sharpen its focus on AI-related dealmaking, including digital infrastructure, semiconductors, connectivity and core software, in response to evolving client demand.
Beyond operations and advisory, Goldman’s AI push is reshaping its revenue mix toward higher-fee, data-driven businesses and away from more balance-sheet-intensive activities. The planned acquisition of Industry Ventures reflects this shift, as Goldman looks to apply advanced analytics and AI to improve valuation, risk assessment and portfolio construction in private markets.
Overall, AI is emerging as a long-term growth engine for the firm, strengthening operating leverage, deepening client relevance and reinforcing Goldman’s competitive positioning.
Robust Liquidity Aids Capital Distribution: GS maintains a fortress balance sheet, with the Tier 1 capital ratios well above regulatory requirements. This financial strength allows it to return capital to shareholders aggressively through buybacks and a healthy dividend yield.
As of Sept. 30, 2025, cash and cash equivalents were $169 billion, and near-term borrowings were $73 billion. Given its strong liquidity, the company rewards its shareholders handsomely.
Post-clearing the 2025 Fed stress test, the company increased the quarterly dividend 33.3% to $4 per common share. In the past five years, the company has hiked dividends five times, with an annualized growth rate of 20.8%. Currently, it has a dividend yield of 1.7%.
JPMorgan raised its dividends six times over the past five years and offers a dividend yield of 1.8%. Morgan Stanley has raised its dividends five times over the past five years and has a dividend yield of 2.1%.
Additionally, Goldman has a share repurchase plan in place. In the first quarter of 2025, the board approved a share repurchase program of up to $40 billion of common stock. At the end of the third quarter, the company had $38.6 billion worth of shares available under authorization.
Goldman’s Earnings Prospects & Valuation Analysis
Analysts are bullish on GS. Over the past 30 days, the Zacks Consensus Estimate for 2025 and 2026 earnings has been revised upward. The Zacks Consensus Estimate for Goldman’s 2025 and 2026 earnings implies year-over-year growth of 20.8% and 12.8%, respectively.
Estimates Revision Trend
Image Source: Zacks Investment Research
In terms of valuation, the GS stock looks expensive compared with the industry. The stock is trading at a forward price/earnings (P/E) of 17.26X above the industry average of 15.71X. Its peers, JPMorgan and Morgan Stanley, have forward P/E multiples of 15.91X and 17.99X, respectively.
Price-to-Earnings F12M
Image Source: Zacks Investment Research
Final Thoughts on GS Stock
Goldman shares have soared 68.1% in the past year, outperforming the industry and its peers, JPMorgan and Morgan Stanley growth.
Price Performance
Image Source: Zacks Investment Research
Goldman’s ongoing growth initiatives, consistent capital returns and a steadily improving AWM business provide a strong foundation for long-term financial performance. A robust M&A backdrop and a healthy deal pipeline continue to underpin the firm’s IB momentum. Embedding AI across operations and advisory is lifting productivity, improving operating leverage and shifting the revenue mix toward higher-fee, data-driven businesses.
In pursuing growth across business segments, operational efficiency remains central to Goldman’s strategy. The company’s recent performance and forward-looking initiatives reaffirm its progress toward achieving its mid-term goals of a 14-16% return on equity and a 60% efficiency ratio.
Supported by a fortress balance sheet, aggressive share repurchases and consistent dividend growth, Goldman offers a compelling combination of earnings growth and shareholder returns.
Despite trading at a modest premium to industry, the valuation is justified by its superior growth outlook and strategic positioning, making Goldman’s stock an attractive 2026 bet.
Image: Bigstock
Should You Buy Goldman Stock as Macro Clarity Rekindles Dealmaking?
Key Takeaways
U.S. dealmaking activity was muted in early 2025 as macroeconomic uncertainty and tariff-related concerns weighed on corporate and private equity decision-making. However, momentum has strengthened in the second half of 2025 and is expected to continue in 2026, supported by improved economic clarity and rising optimism among private equity firms. Hence, the well-known investment bank, Goldman Sachs (GS - Free Report) , is in the spotlight.
Private equity sentiment has rebounded sharply, according to a Citizens Financial survey. While only 48% of private equity leaders felt confident pursuing mergers and acquisitions (M&A) in the first quarter of 2025, confidence surged to 86% by the year-end. Nearly 69% of respondents now describe the M&A environment as strong, and 90% expect deal activity to increase or remain steady.
Looking forward, dealmaking is likely to favor execution-driven strategies, such as carve-outs, de-conglomeration, and buy-and-build transactions over large, transformational deals. This back-to-basics focus will likely lift mid-market activity through smaller, synergy-rich add-ons and faster tech integration. With solid GDP growth and a potential Federal Reserve rate cut, financing conditions are improving, and strategic activity will continue rising.
Against this backdrop, GS stands out as a key beneficiary. Goldman, historically one of the world’s leading M&A advisors, is poised to capture a disproportionate share of advisory fees. The firm topped global M&A rankings in 2025 by hitting $1.66 trillion in volume, advising on 40 megadeals and achieving a market share of 36.4%, followed by JPMorgan (JPM - Free Report) and Morgan Stanley (MS - Free Report) , according to ION Analytics data.
Financial results and management commentary reinforce this outlook. In the first nine months of 2025, Goldman’s M&A advisory fees rose 31% year over year to $3.37 billion, while equity and debt underwriting revenues increased 7% and 11%, driving a 19% rise in total investment banking (IB) fees. Similarly, JPMorgan IB fees rose 12% year over year, while Morgan Stanley's IB revenues increased 15% from the prior-year period in the first nine months of 2025. With a growing M&A pipeline, rising initial public offering activity, and strong advisory backlog, Goldman, JPM, and MS appear well-positioned to sustain solid investment banking performance into 2026.
Other Growth Catalysts for Goldman in 2026
Strategic Streamlining Progresses Well: The company’s streamlining efforts have been underway for some time as it retreats from the underperforming consumer banking ventures. Under CEO David Solomon, the company has embarked on a deliberate transformation to exit non-core consumer banking and double down on the divisions where Goldman maintains a clear competitive advantage.
In sync with its restructuring efforts, in November 2025, Goldman reached an agreement with ING Bank Slaski to divest its Polish asset management firm, TFI. The deal is targeted for completion in the first half of 2026. In the third quarter of 2025, Goldman completed the sale of its GM credit card business to Barclays. In 2024, Goldman completed the sale of GreenSky. In 2023, it sold its Personal Financial Management unit to Creative Planning and also sold all of Marcus’s loan portfolio, part of its broader retreat from consumer banking.
These moves demonstrate a well-thought-out exit, allowing the company to reallocate capital and attention toward higher-margin, more scalable businesses like Global Banking and Markets and the asset and wealth management (AWM) divisions. The benefits of business restructuring began to show in the numbers. The Global Banking and Markets segment’s net revenues rose 17% year over year in the first nine months of 2025, while the AWM division’s net revenues rose 4% year over year, reflecting growing fee income and strength in private credit. In December 2025, GS agreed to acquire Innovator Capital Management, a leading provider of defined outcome exchange-traded funds (ETFs). The transaction significantly expands Goldman’s active ETF capabilities and is part of a broader pivot toward building “durable revenue streams” through diversified AWM offerings.
Betting Big on Private Equity to Aid Growth: The company is aggressively expanding its private equity and alternatives business through acquisitions, platform enhancements and the integration of new investment capabilities, which will likely support its growth over the long run.
In sync with this, in October 2025, Goldman agreed to acquire Industry Ventures, a leading venture capital platform that invests across all stages of the venture capital lifecycle. The planned acquisition of Industry Ventures underscores Goldman’s intent to strengthen its position in private markets and expand access to high-growth technology companies for clients globally.
In September 2025, GS partnered with T. Rowe Price in a $1-billion deal to co-develop retirement and wealth products. Later, the firms expanded the partnership to roll out alternative investment offerings for wealthy clients in 2025 and retirement savers in 2026. In January 2025, the company launched initiatives to grow private credit and other asset classes, including forming the Capital Solutions Group and expanding its alternatives team.
Goldman is expanding its private equity credit services internationally, focusing on Europe, the U.K. and Asia. The company's Asset Management unit intends to expand its private credit portfolio to $300 billion by 2029.
Scaling AI to Transform Business: GS is executing a firmwide artificial intelligence (AI) transformation that spans trading, investment banking, asset management and internal productivity, with a clear objective — to lift fee income and expand operating leverage over the coming years. At the center of this effort are the “One Goldman Sachs 3.0 (OneGS 3.0)” transformation and the “GS AI Assistant” program, both designed to embed generative and predictive AI into nearly every major workflow across the firm.
At the 2025 Goldman Global Conference, CFO Denis Coleman described OneGS 3.0 as a multi-year overhaul that embeds AI as a core operating capability rather than a standalone tool. The initiative focuses on simplifying processes, boosting productivity and enabling scalable growth, supported by high-quality data, shared platforms and modern infrastructure. Coleman emphasized that this foundation allows Goldman to deploy AI responsibly while meeting stringent regulatory and risk-management standards.
In parallel, the firm is reshaping its front-office strategy, recently reorganizing its TMT investment banking division to sharpen its focus on AI-related dealmaking, including digital infrastructure, semiconductors, connectivity and core software, in response to evolving client demand.
Beyond operations and advisory, Goldman’s AI push is reshaping its revenue mix toward higher-fee, data-driven businesses and away from more balance-sheet-intensive activities. The planned acquisition of Industry Ventures reflects this shift, as Goldman looks to apply advanced analytics and AI to improve valuation, risk assessment and portfolio construction in private markets.
Overall, AI is emerging as a long-term growth engine for the firm, strengthening operating leverage, deepening client relevance and reinforcing Goldman’s competitive positioning.
Robust Liquidity Aids Capital Distribution: GS maintains a fortress balance sheet, with the Tier 1 capital ratios well above regulatory requirements. This financial strength allows it to return capital to shareholders aggressively through buybacks and a healthy dividend yield.
As of Sept. 30, 2025, cash and cash equivalents were $169 billion, and near-term borrowings were $73 billion. Given its strong liquidity, the company rewards its shareholders handsomely.
Post-clearing the 2025 Fed stress test, the company increased the quarterly dividend 33.3% to $4 per common share. In the past five years, the company has hiked dividends five times, with an annualized growth rate of 20.8%. Currently, it has a dividend yield of 1.7%.
JPMorgan raised its dividends six times over the past five years and offers a dividend yield of 1.8%. Morgan Stanley has raised its dividends five times over the past five years and has a dividend yield of 2.1%.
Additionally, Goldman has a share repurchase plan in place. In the first quarter of 2025, the board approved a share repurchase program of up to $40 billion of common stock. At the end of the third quarter, the company had $38.6 billion worth of shares available under authorization.
Goldman’s Earnings Prospects & Valuation Analysis
Analysts are bullish on GS. Over the past 30 days, the Zacks Consensus Estimate for 2025 and 2026 earnings has been revised upward. The Zacks Consensus Estimate for Goldman’s 2025 and 2026 earnings implies year-over-year growth of 20.8% and 12.8%, respectively.
Estimates Revision Trend
Image Source: Zacks Investment Research
In terms of valuation, the GS stock looks expensive compared with the industry. The stock is trading at a forward price/earnings (P/E) of 17.26X above the industry average of 15.71X. Its peers, JPMorgan and Morgan Stanley, have forward P/E multiples of 15.91X and 17.99X, respectively.
Price-to-Earnings F12M
Image Source: Zacks Investment Research
Final Thoughts on GS Stock
Goldman shares have soared 68.1% in the past year, outperforming the industry and its peers, JPMorgan and Morgan Stanley growth.
Price Performance
Image Source: Zacks Investment Research
Goldman’s ongoing growth initiatives, consistent capital returns and a steadily improving AWM business provide a strong foundation for long-term financial performance. A robust M&A backdrop and a healthy deal pipeline continue to underpin the firm’s IB momentum. Embedding AI across operations and advisory is lifting productivity, improving operating leverage and shifting the revenue mix toward higher-fee, data-driven businesses.
In pursuing growth across business segments, operational efficiency remains central to Goldman’s strategy. The company’s recent performance and forward-looking initiatives reaffirm its progress toward achieving its mid-term goals of a 14-16% return on equity and a 60% efficiency ratio.
Supported by a fortress balance sheet, aggressive share repurchases and consistent dividend growth, Goldman offers a compelling combination of earnings growth and shareholder returns.
Despite trading at a modest premium to industry, the valuation is justified by its superior growth outlook and strategic positioning, making Goldman’s stock an attractive 2026 bet.
At present, GS carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.