The investment banking giant Goldman Sachs (GS) provided mixed earnings results on Wednesday, as the company had done little to trade and bond trade to compensate for a fall in investment banking income.
Goldman's stock, traded on the New York Stock Exchange, dropped 0.6% from Tuesday's trade, but added over 30% in 2019.
These are the key figures compared to expectations, according to analysts carried out by Bloomberg.
The income of $ 9.96 billion for the fourth quarter was 23% higher than the same period a year ago and 20% higher than the third quarter of 2019, driven primarily by “much higher net income in Asset Management and i). Global Markets. ”
But Goldman's earnings per share fell in the fourth quarter of Wall Street's estimates, and were lower than the $ 6.04 which was added in the fourth year ago, and $ 4.79 in the third quarter of 2019.
During the fourth quarter, Goldman was again seen as trading firms from the same period a year ago. World market revenue was reached at $ 3.48 billion, up 33% from the fourth quarter of 2018, but 2% lower than the third quarter of 2019.
Income from FICC traded back to $ 1.77 billion, “primarily due to significantly higher net incomes in FICC intervention, reflecting higher net incomes across the major firms, including significant increases in interest rate products. , commodities and mortgages. ” t
In terms of equity, revenue jumped 12% from the same year ago to $ 1.71 billion, “reflecting improved sheets and higher average customer balances, and in equity intervention, showing higher net income in cash products.”
Investment banking income fell by 6% over the quarter from the same quarter a year ago to post revenue of $ 2.06 billion, which was 12% lower than the third quarter of 2019. Part of the reason for the decline in income was Due to “significantly lower net income in Financial Advisory income and lower net income in Corporate loans. ”
The reason for this was “a significant reduction in the number of mergers and acquisitions initiatives carried out across the industry.” However, this was “partially offset” by “much higher” income in underwriting. was driven by debt underwriting, return asset activity and equity underwriting.
Overall, Chief Executive David Solomon commended the “strong performance” for the fourth quarter which resulted in a “strong year.” He added that the company will continue to invest in new businesses.
Goldman is the fourth big scale to report this week. JPMorgan Chase (JPM), the largest asset bank U., began a earning season with fourth quarter results relating to Wall Street estimates in a higher year. Citigroup (C) also met estimates, but Wells Fargo suffered a 55% reduction in profit because he was trying to put litany troubles behind her.
With the exception of Wells Fargo, analysts consider that stable interest rates, growth of loans – and healthy consumers and free spending – will add to the baselines of the banks this year.
The health of the US economy is, in our view, a “key driver of banks' performance in 2020, and a large bank with a strong weighting for US consumer and small business activity,” says Kenneth Leon, CFRA equity research director, recently.