Goldman Sachs Q4 Earnings Surge, Beating Expectations

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January 18, 2017 8:10am NYSE:GS

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From Goldman Sachs Group Inc (NYSE:GS) early Wednesday posted better than expected fourth quarter earnings results, logging revenue growth across nearly all business units.

The New York City-based financial services giant reported Q4 EPS of $5.08, which was $0.28 better than the Wall Street consensus estimate of $4.80. Revenues jumped 12.3% from last year to $8.17 billion, also easily topping analysts’ view for $7.8 billion.

Goldman noted that overall annualized return on investment (ROE( was 11.4% for the fourth quarter of 2016.

Investment Banking net revenues fell 4% from last year to $1.49 billion, while Institutional Client Services revenue surged 25% to $3.60 billion. Investing & Lending revenues rose 15% to $1.48 billion, and Investment Management revenues edged 3% higher to $1.61 billion. Finally, non-compensation expenses plunged 44% year-over-year to $2.33 billion, helped by less provisions for litigation and regulatory proceedings.

The company commented via press release:

“After a challenging first half, the firm performed well for the remainder of the year as the operating environment improved,” said Lloyd C. Blankfein, Chairman and Chief Executive Officer. “We continued to manage our expenses carefully and we enter the new year with industry leading positions across our businesses, as well as strong capital and liquidity.”

Goldman Sachs Group Inc shares fell $0.73 (-0.31%) in premarket trading Wednesday. Year-to-date, GS has declined -1.55%, versus a +1.22% rise in the benchmark S&P 500 index during the same period.

GS currently has a POWR Rating of A (Strong Buy), and is ranked #1 of 31 stocks in the Investment Brokerage category.

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