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Goldman Sachs reports record results that top the Street amid booming investment banking
PUBLISHED WED, APR 14 20217:06 AM EDTUPDATED WED, APR 14 20217:30 AM EDT
Thomas Franck
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Hugh Son
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David Solomon, CEO, Goldman Sachs, speaking at the World Economic Forum in Davos, Switzerland, Jan. 23, 2020.
David Solomon, CEO, Goldman Sachs, speaking at the World Economic Forum in Davos, Switzerland, Jan. 23, 2020.
Adam Galacia | CNBC
Goldman Sachs reported first-quarter earnings before the opening bell on Wednesday.
Here are the numbers:
Earnings: $18.60 per share, vs. $10.22 per share expected by analysts polled by Refinitiv.
Revenue: $17.7 billion, vs. $12.6 billion expected.
Expectations for Goldman Sachs are running high amid favorable conditions for many of the Wall Street businesses that the firm operates.
Analysts expect revenue growth to be driven by surging investment banking fees, helped in part by the record first-quarter issuance of blank check companies known as SPACs. Trading desks may also post higher revenue than a year earlier, and buoyant markets bode well for asset management fees.
Of the six biggest U.S. banks, Goldman gets the biggest share of its revenue from Wall Street activities including trading and investment banking. For the past few years that has been a detriment to the firm, as retail banking fueled by cheap consumer deposits has driven the industry’s record profits.
That dynamic reversed during the coronavirus pandemic, when firms with sizeable consumer operations had to set aside tens of billions of dollars for anticipated loan losses, causing banks like Wells Fargo to post their first quarterly loss since the financial crisis.
Goldman shares have climbed 24% this year, roughly matching the gain of the KBW Bank Index.
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