NEW YORK (TheStreet) -- Shares of Goldman Sachs (GS) - Get Goldman Sachs Group, Inc. (GS) Report are up by 1.22% to $183.15 at the start of trading on Monday morning, following a rating upgrade to "outperform" from "perform" at Oppenheimer this morning.
The firm raised its rating on Goldman Sachs, a global financial services company, based on valuation, better than expected returns of the company's FICC business and a positive mix shift to less capital intensive business, The Fly reports.
Oppenheimer set a $236 price target on Goldman Sachs stock.
Goldman Sachs' "FICC trading accounted for 25% of revenues in 2014 (48% in 2009), and for the industry FICC trading revenues have been down in 17 of the last 22 quarters," Oppenheimer said in a note.
"However, the argument that Goldman cannot thrive in this environment-one that we have made ourselves-is increasingly sounding like the argument that bumble bees can't fly," the firm added.
Separately, TheStreet Ratings team rates GOLDMAN SACHS GROUP INC as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate GOLDMAN SACHS GROUP INC (GS) a BUY. This is driven by several positive factors, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels and solid stock price performance. We feel its strengths outweigh the fact that the company has had sub par growth in net income."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- After a year of stock price fluctuations, the net result is that GS's price has not changed very much. Although its weak earnings growth may have played a role in this flat result, don't lose sight of the fact that the performance of the overall market, as measured by the S&P 500 Index, was essentially similar. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- GOLDMAN SACHS GROUP INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, GOLDMAN SACHS GROUP INC increased its bottom line by earning $17.07 versus $15.47 in the prior year. This year, the market expects an improvement in earnings ($17.83 versus $17.07).
- GS, with its decline in revenue, slightly underperformed the industry average of 6.7%. Since the same quarter one year prior, revenues slightly dropped by 1.4%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
- The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. When compared to other companies in the Capital Markets industry and the overall market, GOLDMAN SACHS GROUP INC's return on equity is below that of both the industry average and the S&P 500.
- You can view the full analysis from the report here: GS