Goldman Sachs
GS
$1098.20
+1.16%
Goldman Sachs is a leading global investment bank, providing M&A advisory, market making, trading, lending, asset management, and wealth management services. As the top-ranked M&A advisor by revenue for 20 years, it has diversified into stable fee-based businesses like asset and wealth management, which now comprise roughly 30% of post-provision revenue. The current investor narrative centers on its ability to sustain revenue growth amid a volatile trading environment and rising interest rates, with recent Q2 2026 earnings showing a 22.9% YoY revenue surge driven by strong performance in Global Markets and Investment Banking.…
GS
Goldman Sachs
$1098.20
Related headlines
Investment Opinion: Should I buy GS Today?
Rating: Hold. Goldman Sachs is a high-quality franchise with strong momentum, but the stock's proximity to its 52-week high and limited analyst upside suggest a balanced risk/reward. The consensus Hold rating and average target of $1,090.10 imply modest 2.3% upside, supporting a neutral stance.
Supporting evidence: The trailing P/E of 16.9x is in line with the industry average of ~15-18x, while the forward P/E of 14.8x implies expected earnings growth. Revenue grew 22.9% YoY, and operating margin expanded to 30.0% from 15.9%. The PEG ratio of 0.65 suggests undervaluation relative to growth, but the P/B of 2.20x is above the 5-year average, indicating some premium. Free cash flow is negative, but the company is profitable with ROE of 13.7%.
Risks & Conditions: The Hold rating would upgrade to Buy if the stock pulls back to $950 (10% downside) or if revenue growth sustains above 20% for another quarter. It would downgrade to Sell if revenue growth decelerates below 10% or if the Fed's rate hikes trigger a recession. Overall, the stock appears fairly valued relative to its history and peers, with a slight premium justified by its strong brand and earnings momentum.
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GS 12-Month Price Forecast
Goldman Sachs shows strong near-term momentum with accelerating revenue and expanding margins, but the stock's valuation is already pricing in much of the good news. The PEG ratio suggests undervaluation, but the high debt and negative free cash flow warrant caution. The neutral stance reflects a balanced risk/reward: the stock could grind higher if earnings continue to beat, but a pullback is possible given the recent run-up. An upgrade to bullish would require sustained revenue growth above 20% and a pullback to $950; a downgrade to bearish would follow a recessionary shock or a significant miss on earnings.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Goldman Sachs's 12-month outlook, with a consensus price target around $1134.40 and implied upside of +3.3% versus the current price.
Average Target
$1134.40
0 analysts
Implied Upside
+3.3%
vs. current price
Analyst Count
—
covering this stock
Price Range
$730 - $1325
Analyst target range
Goldman Sachs is covered by 20 analysts, with a consensus recommendation of 'hold' (mean rating 2.68, where 1=Strong Buy, 5=Strong Sell). The average target price is $1,090.10, implying a modest 2.3% upside from the current price of $1,065.22. The distribution leans neutral, with recent ratings from JP Morgan (Neutral), Keefe Bruyette (Market Perform), and Barclays (Overweight). The target range spans from $730.00 (low) to $1,325.00 (high). The high target of $1,325 assumes continued strong performance in trading and investment banking, while the low target of $730 reflects risks from a potential recession or regulatory headwinds. The wide spread of $595 indicates significant uncertainty. Recent analyst actions show mostly reiterations, with Oppenheimer downgrading to Underperform from Perform on June 30, 2026, suggesting some caution. The consensus EPS estimate for the current year is $77.09, with a range of $70.31 to $84.55, implying expected earnings growth of about 20% from the prior year.
Bulls vs Bears: GS Investment Factors
Goldman Sachs presents a mixed picture: strong revenue acceleration (22.9% YoY), expanding margins (operating margin 30.0%), and a low PEG ratio (0.65) support the bull case, while high leverage (D/E 4.88), negative free cash flow, and a consensus Hold rating with limited upside (2.3% to average target) temper enthusiasm. The bull case currently has stronger evidence given the earnings momentum and valuation support, but the key tension is whether the recent revenue surge is sustainable or a cyclical peak. If trading and investment banking revenues continue to grow, the stock could re-rate higher; if they normalize, the high valuation multiples could compress.
Bullish
- Strong Revenue Acceleration: Q2 2026 revenue surged 22.9% YoY to $38.4B, accelerating sharply from 2.9% growth in Q2 2025, driven by Global Markets ($20.6B) and Investment Management ($9.2B). This demonstrates robust top-line momentum across core businesses.
- Expanding Profit Margins: Operating margin improved to 30.0% in Q2 2026 from 15.9% a year ago, while net income margin rose to 17.2% from 11.9%. This reflects effective cost control and operating leverage from higher revenue.
- Attractive PEG Ratio: With a PEG ratio of 0.65, the stock appears undervalued relative to its earnings growth rate. A PEG below 1.0 typically signals that the market is not fully pricing in the company's growth potential.
- Strong Earnings Growth: EPS jumped to $21.27 in Q2 2026 from $11.07 in Q2 2025, a 92% increase. Consensus EPS estimates for the current year are $77.09, implying ~20% growth from the prior year, supporting the forward P/E of 14.8x.
Bearish
- High Debt-to-Equity Ratio: The debt-to-equity ratio of 4.88 is elevated, typical for investment banks but still a risk in a rising-rate environment. Interest expense of $18.1B in Q2 2026 consumes a significant portion of revenue.
- Negative Free Cash Flow: Trailing twelve-month free cash flow is -$41.9B, largely due to working capital swings. While not unusual for a bank, it limits the company's ability to return capital to shareholders without relying on debt.
- Near 52-Week High: At $1,065.22, the stock trades at 92.3% of its 52-week high of $1,153.99, leaving limited upside if momentum stalls. The recent 1-month decline of -3.1% suggests profit-taking after a strong run.
- Analyst Consensus Hold: With a mean recommendation of 2.68 (Hold) and average target of $1,090.10 (only 2.3% upside), analysts see limited near-term upside. The low target of $730 implies a potential 31% downside.
GS Technical Analysis
Goldman Sachs is in a sustained uptrend, with a 1-year price change of +50.9%, significantly outperforming the S&P 500's +18.4%. The current price of $1,065.22 sits at 92.3% of its 52-week range ($691.88 - $1,153.99), indicating the stock is near its highs and reflecting strong momentum but also potential overextension. The stock's beta of 1.29 suggests it is 29% more volatile than the market, amplifying both upside and downside moves. Short-term momentum shows a 1-month decline of -3.1% and a 3-month gain of +15.0%, signaling a recent pullback within a longer-term uptrend. The 1-month underperformance relative to the S&P 500 (relative strength -3.4%) suggests a temporary pause or profit-taking, while the 3-month relative strength of +10.4% confirms the broader uptrend remains intact. The 52-week low of $691.88 provides strong support, while the 52-week high of $1,153.99 acts as resistance. A breakout above $1,154 would signal renewed bullish momentum, while a breakdown below $1,020 (recent June lows) could indicate a deeper correction. With a beta of 1.29, the stock is more volatile than the market, requiring careful risk management.
Beta
1.29
1.29x market volatility
Max Drawdown
-19.8%
Largest decline past year
52-Week Range
$694-$1154
Price range past year
Annual Return
+56.8%
Cumulative gain past year
| Period | GS Return | S&P 500 |
|---|---|---|
| 1m | -0.7% | +0.4% |
| 3m | +17.9% | +5.5% |
| 6m | +19.5% | +8.4% |
| 1y | +56.8% | +18.9% |
| ytd | +20.1% | +9.6% |
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GS Fundamental Analysis
Goldman Sachs reported Q2 2026 revenue of $38.4 billion, up 22.9% year-over-year, accelerating from the 2.9% growth in Q2 2025. The revenue trajectory is strong, driven by Global Markets ($20.6 billion) and Investment Management ($9.2 billion), which together account for 78% of total revenue. Net income for Q2 2026 was $6.63 billion, up from $3.72 billion in the prior year quarter, reflecting robust earnings growth. Profitability is solid, with a gross margin of 52.7% and an operating margin of 30.0% in Q2 2026, both improving from 45.4% and 15.9% a year ago. Net income margin expanded to 17.2% from 11.9%, driven by revenue growth and cost control. The company is profitable with EPS of $21.27, up from $11.07 in Q2 2025. The balance sheet shows a debt-to-equity ratio of 4.88, which is high but typical for investment banks. Free cash flow was negative -$32.4 billion in Q1 2026, largely due to working capital changes, but the company generated positive free cash flow of $5.2 billion in Q2 2025. ROE stands at 13.7%, indicating efficient capital use. The current ratio of 0.83 suggests some liquidity risk, but the large cash position ($179.5 billion) provides a buffer.
Quarterly Revenue
$38.4B
2026-06
Revenue YoY Growth
+22.9%
YoY Comparison
Gross Margin
52.7%
Latest Quarter
Free Cash Flow
$-41.9B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is GS Overvalued?
Since net income is positive, the primary valuation metric is the P/E ratio. The trailing P/E is 16.9x, while the forward P/E is 14.8x, implying the market expects earnings growth. The gap between trailing and forward P/E suggests a 12% expected earnings increase, which aligns with the strong recent performance. Compared to the industry average (not provided, but typically around 15-18x for diversified financials), Goldman's trailing P/E of 16.9x appears in line. The P/B ratio of 2.20x is above the sector average of ~1.5x, reflecting a premium for its strong brand and profitability. The PEG ratio of 0.65 suggests the stock is undervalued relative to its growth rate, as a PEG below 1.0 typically indicates undervaluation. Historically, Goldman's trailing P/E has ranged from 6.2x (Q3 2021) to 25.8x (Q2 2023). The current 16.9x is near the middle of this range, suggesting the stock is fairly valued relative to its own history. The P/B ratio of 2.20x is above the 5-year average of ~1.5x, indicating the market is pricing in higher returns on equity.
PE
16.9x
Latest Quarter
vs. Historical
Mid-Range
5-Year PE Range 6x~26x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
30.0x
Enterprise Value Multiple
Investment Risk Disclosure
Financial & Operational Risks: Goldman Sachs' high debt-to-equity ratio of 4.88 exposes it to interest rate risk, as interest expense of $18.1B in Q2 2026 represents a significant fixed cost. Negative free cash flow of -$41.9B TTM, while partly due to working capital, limits financial flexibility. The current ratio of 0.83 indicates potential liquidity stress, though the $179.5B cash position provides a buffer. Earnings are volatile, with EPS swinging from $11.07 to $21.27 YoY, making forecasting difficult.
Market & Competitive Risks: The stock's beta of 1.29 implies 29% higher volatility than the market, amplifying downside in selloffs. Trading at a P/B of 2.20x (above the 5-year average of ~1.5x) leaves it vulnerable to multiple compression if ROE declines. Recent analyst downgrades (e.g., Oppenheimer to Underperform) and sector rotation warnings suggest the market may be pricing in perfection. Regulatory headwinds, such as higher capital requirements, could pressure returns.
Worst-Case Scenario: A recession causing a sharp decline in trading and investment banking revenues, combined with credit losses, could drive the stock to its 52-week low of $691.88, a 35% drop from the current price of $1,065.22. This scenario aligns with the analyst low target of $730 and would be triggered by a sustained bear market in equities and a freeze in M&A activity.
FAQ
The primary risks are: 1) Financial risk from high leverage (D/E 4.88) and negative free cash flow (-$41.9B TTM), which could constrain capital returns. 2) Market risk from a recession or bear market, which would reduce trading and investment banking revenues, potentially driving the stock to the low target of $730 (31% downside). 3) Regulatory risk from higher capital requirements or stricter oversight. 4) Valuation risk from a potential multiple compression if earnings growth decelerates, given the stock's premium P/B. The most severe risk is a recession, which could trigger a 35% decline to the 52-week low of $691.88.
The 12-month outlook is balanced: the base case (50% probability) sees the stock trading between $1,000 and $1,150, with the average analyst target of $1,090.10 implying 2.3% upside. The bull case (25% probability) targets $1,154-$1,325, driven by sustained strong earnings, while the bear case (25% probability) sees a decline to $730-$850 if a recession hits. The most likely scenario is the base case, assuming revenue growth moderates to 10-15% and earnings meet consensus estimates of $77.09 EPS.
Based on a trailing P/E of 16.9x and forward P/E of 14.8x, GS appears fairly valued relative to the industry average of 15-18x. The PEG ratio of 0.65 suggests it is undervalued relative to its earnings growth rate, implying the market is not fully pricing in the growth potential. However, the P/B ratio of 2.20x is above the 5-year average of ~1.5x, indicating a premium for its strong brand and profitability. Overall, the stock is fairly valued with a slight growth premium, and the market expects continued earnings expansion.
Goldman Sachs offers a compelling risk/reward for growth-oriented investors, with strong revenue momentum (22.9% YoY growth) and a low PEG ratio of 0.65 suggesting undervaluation relative to earnings growth. However, the stock trades near its 52-week high with only 2.3% upside to the average analyst target of $1,090.10, and the consensus Hold rating indicates limited near-term upside. It could be a good buy for those willing to hold through volatility, especially on a pullback to $950 or below, but investors seeking immediate returns may find better opportunities elsewhere.
Goldman Sachs is better suited for long-term investment (3-5 years) due to its cyclical nature and high beta of 1.29, which makes it volatile in the short term. The stock has a dividend yield of 1.9% and a payout ratio of 30.7%, providing some income, but its earnings are tied to capital markets activity. Short-term traders may find opportunities around earnings announcements, but the limited upside to the average target suggests a hold for now. A minimum holding period of 12 months is recommended to ride out volatility and capture the next earnings cycle.