The Goldman Sachs Group, Inc. (NYSE:GS) investors will be delighted, with the company turning in some strong numbers with its latest results. It was overall a positive result, with revenues beating expectations by 8.0% to hit US$13b. Goldman Sachs Group also reported a statutory profit of US$8.40, which was an impressive 21% above what the analysts had forecast. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Goldman Sachs Group after the latest results.
Taking into account the latest results, the consensus forecast from Goldman Sachs Group's 16 analysts is for revenues of US$54.4b in 2025. This reflects a meaningful 10% improvement in revenue compared to the last 12 months. Statutory earnings per share are predicted to surge 21% to US$41.80. Before this earnings report, the analysts had been forecasting revenues of US$53.4b and earnings per share (EPS) of US$40.31 in 2025. The analysts seems to have become more bullish on the business, judging by their new earnings per share estimates.
The consensus price target was unchanged at US$548, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. Currently, the most bullish analyst values Goldman Sachs Group at US$614 per share, while the most bearish prices it at US$450. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. It's clear from the latest estimates that Goldman Sachs Group's rate of growth is expected to accelerate meaningfully, with the forecast 8.1% annualised revenue growth to the end of 2025 noticeably faster than its historical growth of 4.3% p.a. over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to grow their revenue at 3.4% per year. Factoring in the forecast acceleration in revenue, it's pretty clear that Goldman Sachs Group is expected to grow much faster than its industry.
The Bottom Line
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Goldman Sachs Group following these results. Fortunately, they also reconfirmed their revenue numbers, suggesting that it's tracking in line with expectations. Additionally, our data suggests that revenue is expected to grow faster than the wider industry. The consensus price target held steady at US$548, with the latest estimates not enough to have an impact on their price targets.
With that in mind, we wouldn't be too quick to come to a conclusion on Goldman Sachs Group. Long-term earnings power is much more important than next year's profits. We have estimates - from multiple Goldman Sachs Group analysts - going out to 2026, and you can see them free on our platform here.
It is also worth noting that we have found 2 warning signs for Goldman Sachs Group that you need to take into consideration.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
