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Goldman Posts Unexpected Surge in Profits

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  • Firm’s profit soars 27%, bucking analyst expectations of a drop
  • Fixed-income revenue surpasses even the most optimistic estimates

Goldman Sachs experienced a 27%[1] increase in net income compared to the previous year, defying analysts’ expectations of a decline.

Robust results in investment banking and an expanding asset management division for wealthy clients boosted the Wall Street giant’s bottom line.

Source: Company Filings

The earnings included a $78 million charge due to an extra Federal Deposit Insurance Corp. assessment linked to regional bank collapses last year.

Nonetheless, net income reached $4.13 billion[2], or $11.58 per share, surpassing the expectations for the first quarter of 2024.

Revenue climbed to $14.2 billion from the previous year, fueled by a 32% increase in investment banking fees. Additionally, asset and wealth management revenue grew by 18% to $3.79 billion.

Fixed-income trading exceeded forecasts with $4.32 billion in revenue despite anticipated declines from mortgages and structured lending.

Furthermore, equity trading revenue rose to $3.31 billion, exceeding expectations as the firm aims to solidify its position as the leading stock-trading entity.

Investment banking revenue reached $2.08 billion, surpassing the analysts’ forecast of $1.82 billion. Merger advisory fees also exceeded expectations at $1.01 billion.

The firm’s equity-capital business generated $370 million, buoyed by an increase in public stock offerings, while debt-underwriting revenue was $699 million. The company noted a decrease in its deal backlog from the previous quarter.

With ongoing high inflation due to a robust economy, it is anticipated that the Federal Reserve will maintain high-interest rates. As a result, corporate bond yields are rising, leading to reduced expectations for rate cuts this year and potentially lower fee income from debt issuance moving forward.

Goldman’s asset and wealth management division reported revenue of $3.79 billion, an 18% jump from the previous year.

Management fees grew by 7%, reflecting the bank’s strategy to focus on sustainable fee-based revenue rather than sporadic gains from balance sheet investments.

The firm also raised $14 billion for investments in private markets during the quarter, with total assets under management escalating to $2.85 trillion.

⁠Goldman’s stock climbed 3%[3].⁠

Investors can long Goldman Sachs using our  2x Goldman Sachs.

Alternatively, traders can short Goldman Sachs using our  -1x Goldman Sachs.

 


Footnotes:
  1. Company data
  2. Company data
  3. Tradingview

Your capital is at risk if you invest. You could lose all your investment. Please see the full risk warning here.

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Violeta Todorova

Senior Research

Violeta è entrata a far parte di Leverage Shares nel settembre 2022. È responsabile dello svolgimento di analisi tecniche e ricerche macroeconomiche ed azionarie, fornendo pregiate informazioni per aiutare a definire le strategie di investimento per i clienti.

Prima di cominciare con LS, Violeta ha lavorato presso diverse società di investimento di alto profilo in Australia, come Tollhurst e Morgans Financial, dove ha trascorso gli ultimi 12 anni della sua carriera.

Violeta è un tecnico di mercato certificato dall’Australian Technical Analysts Association e ha conseguito un diploma post-laurea in finanza applicata e investimenti presso Kaplan Professional (FINSIA), Australia, dove è stata docente per diversi anni.

Julian Manoilov

Marketing Lead

Julian è entrato a far parte di Leverage Shares nel 2018 come parte della prima espansione della società in Europa orientale. È responsabile della progettazione di strategie di marketing e della promozione della notorietà del marchio.

Oktay Kavrak

Head of Communications and Strategy

Oktay è entrato a far parte di Leverage Shares alla fine del 2019. È responsabile della crescita aziendale, mantenendo relazioni chiave e sviluppando attività di vendita nei mercati di lingua inglese.

È entrato in LS da UniCredit, dove è stato responsabile delle relazioni aziendali per le multinazionali. La sua precedente esperienza è in finanza aziendale e amministrazione di fondi in società come IBM Bulgaria e DeGiro / FundShare.

Oktay ha conseguito una laurea in Finanza e contabilità ed un certificato post-laurea in Imprenditoria presso il Babson College. Ha ottenuto anche la certificazione CFA.

Sandeep Rao

Research
Sandeep è entrato a far parte di Leverage Shares nel settembre 2020. È responsabile della ricerca sulle linee di prodotto esistenti e nuove, su asset class e strategie, con particolare riguardo all’analisi degli eventi attuali ed i loro sviluppi. Sandeep ha una lunga esperienza nei mercati finanziari. Iniziata in un hedge fund di Chicago come ingegnere finanziario, la sua carriera è proseguita in numerose società ed organizzazioni, nel corso di 8 anni – da Barclays (Capital’s Prime Services Division) al più recente Index Research Team di Nasdaq. Sandeep detiene un M.S. in Finanza ed un MBA all’Illinois Institute of Technology di Chicago.

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