David Solomon, CEO of Goldman Sachs, speaking at the World Economic Forum in Davos, Switzerland, on January 23, 2020.
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Goldman Sachs on Tuesday surpassed analysts ’expectations for fourth-quarter earnings and revenue, thanks to strong performance from equity traders and investment banks.
The bank made a profit of $ 12.08 per share, crushing the estimate of $ 7.47 per share from analysts surveyed by Refinitiv. Revenue of $ 11.744 billion exceeded the estimate by about $ 1.752 billion.
Goldman CEO David Solomon was running out of expectations. Last week, JPMorgan Chase posted record fourth-quarter trading and advisory results that helped the bank beat earnings estimates.
Of the six largest banks in the United States, Goldman derives most of its revenue from Wall Street activities, including banking and investment. In recent years, this has been detrimental to the firm, as retail banking has boosted industry records.
Now, during the last quarter of a year marked by the coronavirus pandemic, the Goldman model may prove an advantage. Companies with large consumer credit operations were forced to allocate tens of billions of dollars in provisions for loans on loan.
But open markets, thanks to the unprecedented actions of the Federal Reserve earlier this year, are expected to help usher in the best year to trade on Wall Street since the financial crisis. Meanwhile, investment bankers are benefiting from growing demand for stock market investments and a record period of debt issuance.
Goldman shares rose 11% in 2020, surpassing the 4.3% decline in the KBW Bank index.
Here are the numbers:
Profits: $ 12.08 per share, compared to $ 7.47 per expected share, according to Refinitiv.
Revenue: $ 11.744 billion, compared to $ 9.9 billion.
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