Goldman Sachs Chairman and CEO David M. Solomon speaks at the Milken Institute’s 22nd Annual Global Conference in Beverly Hills, April 29, 2019
Mike Blake | Reuters
Goldman Sachs is expected to release its first-quarter results before the opening bell on Thursday.
Here’s what Wall Street expects:
- Earnings: $8.89 per share, 52% lower than a year earlier, according to Refinitiv
- Revenues: $11.83 billion, 33% less than a year earlier.
- Trading revenue: Fixed income: $3.04 billion, stocks: $2.58 billion, according to StreetAccount.
- Investment banking revenue: $2.41 billion.
Goldman Sachs was a big beneficiary of two torrid years of deal activity on Wall Street, posting record revenue numbers and beating performance targets.
But how will the bank navigate tougher markets?
That’s what analysts are eager to hear after mergers, IPOs and debt issuance slowed in the first quarter.
Goldman Sachs is the world’s largest mergers adviser by revenue and the most Wall Street-dependent company among the six largest U.S. banks. One of CEO David Solomon’s biggest priorities has been to diversify the company’s revenue streams, boosting consumer banking, wealth and asset management operations.
Analysts will want to ask Solomon what the deal pipeline looks like for the rest of 2022, and whether mergers and IPOs are being killed off, or just pushed back into the coming quarters.
Another area of concern for the bank is trading, where spikes in volatility and market disruption caused by the war in Ukraine may have benefited some traders, while leaving others to suffer losses. It remains to be seen whether the quarter’s tumult led to the kind of volatility that encouraged clients to trade, or left them on the sidelines.
In February, Solomon raised the bank’s forecast for returns and targets in the wealth and asset management divisions after it significantly exceeded targets set at the start of 2020.
Goldman shares have fallen 15.8% this year through Thursday, compared to the 10.5% drop in the KBW banking index.
On Wednesday, JPMorgan Chase said first-quarter profits fell 42% as it posted losses related to Russian sanctions and set aside cash for future loan losses.
This story is developing. Please check for updates.