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Goldman Sachs (GS) Gains But Lags Market: What You Should Know

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In the latest trading session, Goldman Sachs (GS - Free Report) closed at $231.28, marking a +1.35% move from the previous day. The stock lagged the S&P 500's daily gain of 2.12%. Elsewhere, the Dow gained 2.13%, while the tech-heavy Nasdaq added 2.64%.

Heading into today, shares of the investment bank had gained 2.37% over the past month, outpacing the Finance sector's loss of 2.62% and the S&P 500's loss of 4.4% in that time.

Wall Street will be looking for positivity from GS as it approaches its next earnings report date. This is expected to be January 16, 2019. The company is expected to report EPS of $6.11, up 7.57% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $8.26 billion, up 5.46% from the prior-year quarter.

GS's full-year Zacks Consensus Estimates are calling for earnings of $25.32 per share and revenue of $36.34 billion. These results would represent year-over-year changes of +28.14% and +13.32%, respectively.

Investors should also note any recent changes to analyst estimates for GS. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 2.56% higher. GS is currently a Zacks Rank #3 (Hold).

Digging into valuation, GS currently has a Forward P/E ratio of 9.01. This represents a discount compared to its industry's average Forward P/E of 12.79.

We can also see that GS currently has a PEG ratio of 0.75. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Financial - Investment Bank stocks are, on average, holding a PEG ratio of 0.85 based on yesterday's closing prices.

The Financial - Investment Bank industry is part of the Finance sector. This group has a Zacks Industry Rank of 110, putting it in the top 43% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.




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