Goldman Sachs Group Inc Stock Buy Recommendation Reiterated (GS)

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

NEW YORK ( TheStreet) -- Goldman Sachs Group (NYSE: GS) has been reiterated by TheStreet Ratings as a buy with a ratings score of B- . The company's strengths can be seen in multiple areas, such as its revenue growth, compelling growth in net income, solid stock price performance and impressive record of earnings per share growth. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.

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Highlights from the ratings report include:
  • The revenue growth came in higher than the industry average of 11.9%. Since the same quarter one year prior, revenues rose by 38.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Capital Markets industry. The net income increased by 185.5% when compared to the same quarter one year prior, rising from $1,013.00 million to $2,892.00 million.
  • Powered by its strong earnings growth of 204.34% and other important driving factors, this stock has surged by 38.15% over the past year, outperforming the rise in the S&P 500 Index during the same period. Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains in the past year.
  • GOLDMAN SACHS GROUP INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, GOLDMAN SACHS GROUP INC increased its bottom line by earning $14.15 versus $4.41 in the prior year. For the next year, the market is expecting a contraction of 5.1% in earnings ($13.43 versus $14.15).

The Goldman Sachs Group, Inc. provides investment banking, securities, and investment management services, as well as a range of financial services to corporations, financial institutions, governments and high-net-worth individuals worldwide. Goldman Sachs Group has a market cap of $72.62 billion and is part of the financial sector and financial services industry. The company has a P/E ratio of 10.9, below the S&P 500 P/E ratio of 17.7. Shares are up 21.1% year to date as of the close of trading on Thursday.

You can view the full Goldman Sachs Group Ratings Report or get investment ideas from our investment research center.

--Written by a member of TheStreet Ratings Staff.

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