Stan Wong Goldman Sachs GS-N BUY ON WEAKNESS Mar 13, 2025

Likes US financials. Likes its ability to really take advantage of increased M&A activity. See his Top Picks.

At 13X earnings, considering earnings, capital markets outlook and interest rate forecasts, we think it still looks good.
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The analyst who downgraded GS is saying nothing new, including a delay in the M&A cycle. The IPO market will likely emerge in second-half 2025. Also consider is defaults will rise? Lending growth slow or reverse? The overall economy slow down?

The US about to see a wave of mergers and IPOs and GS will benefit from that.

It reports Monday. As an investment bank, its business can be episodic, but he expects the CEO to deliver on the top and bottom lines--the top because of trading (their forte) and bottom because of, well, firing a bunch of people that they've been doing.

If he were in charge, his share buyback zone would be between $360-450. Looking at the chart, you can see overhead resistance since the election; this shows up on so many stocks, and is more of a sell zone. See today's Educational Segment.

A buy at 11.8X earnings.

Of the big banks, they are the most levered to investment banking, including IPOs. He bought it expecting an uptick in IPOs under Trump, but his tariffs have temporarily derailed that. The IPO revival should happen if tariffs don't return. This pulled back hard since mid-February because of those tariffs, down 35%.

Is perfectly positioned for the tailwinds under the Trump presidency. After April's tariffs, corporate boards have been sitting and waiting, reluctant to do deals, but a strong capital market will eventually happen. Pays a good dividend and are very well-capitalized.