This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Goldman Sachs Earnings: Here's How to Read Them

In terms of Goldman's core business, investment banking fees are expected to rise significantly in the fourth quarter, while fixed income sales & trading revenue may underwhelm for the second consecutive quarter.

KBW analyst Fred Cannon expects Goldman to earn $1.72 billion in investment banking revenue, up 47% quarter-over-quarter and up 22% year-over-year on particularly strong equity underwriting and M&A advisory performance.

Total trading revenue, however, could fall 10% quarter-over-quarter to $2.87 billion, even after interest rate volatility and losses in correlated assets like currencies hurt the firm's third quarter results. Equity trading could prove strong while fixed income, currency & commodity trading could disappoint.

Credit Suisse recently lowered its estimate of FICC sales & trading revenue to $1.7 billion and forecasts 0-2% revenue growth in the unit through 2016. "[We] believe the favorable conditions that have characterized the last few years (higher prices, easy monetary policy, robust fund flows) could slow down and be exacerbated by regulations (e.g. derivatives reform)," the analysts said.

Must Read: Bank of America Posts Higher Profit As Expenses Fall

Bottom Line: Goldman Sachs may post a big earnings beat in the fourth quarter that could still disappoint investors.

Goldman's Operating Performance Raises Question Marks

-- Written by Antoine Gara in New York

2 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
GS $159.53 0.00%
AAPL $93.24 0.00%
FB $117.81 0.00%
GOOG $701.43 0.00%
TSLA $211.53 0.00%


Chart of I:DJI
DOW 17,660.71 +9.45 0.05%
S&P 500 2,050.63 -0.49 -0.02%
NASDAQ 4,717.0940 -8.5450 -0.18%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs