GS reports earnings tomorrow night; investment banking fees are more worth watching than total profits
From tonight until GS reports tomorrow night, I’m more inclined to think the U.S.-listed stock will continue to rebound. It recovered Thursday’s losses on Friday and is also rising in premarket trading tonight. Investment banking fees grew quickly last quarter, and the firm has more projects in its pipeline than before. I think buying ahead of this earnings report still has a chance to continue.
GS closed at $895.32 on Friday, above Wednesday’s close of $887.21. It’s trading around $900 in premarket tonight, with the intraday high of $913 from early October still ahead. This isn’t a major rally, but Friday’s rebound has held for now, and the recent high has yet to be broken. If the stock gives back Friday’s gains tonight, the case for a continued pre-earnings rebound will weaken.
Second-quarter investment banking fees were about $3.4 billion, up 55% year over year. Revenue from equity underwriting, debt underwriting, and M&A advisory all increased, and the investment banking pipeline also grew from the end of the first quarter. A larger pipeline creates the potential for fees to keep growing—but projects can be canceled or take a long time to close, so a bigger pipeline doesn’t automatically translate into revenue.
Equities revenue grew 72% year over year in the same quarter. A gain of more than 70% is certainly encouraging, but this business includes trading and financing, so revenue can fluctuate as client activity changes. The rapid growth last quarter doesn’t mean the third quarter will see the same increase. Rather than simply extrapolating from total profits, I’d rather see whether investment banking projects continue to convert into fee revenue.
These business figures are actual second-quarter results released in July; tomorrow night’s report will cover the third quarter. To judge whether GS beats market expectations, we’ll need reliable consensus estimates for comparison. The pre-earnings rebound and the stock’s post-earnings performance should also be considered separately: if growth slows, the share price could still fall after its recent rise.
The earnings report is due around 7:30 tomorrow night, followed by a conference call at 9:30. The pipeline grew last quarter; tomorrow night, the key question is whether those projects have continued to generate revenue.
#GS #美股 #Earnings
From tonight until GS reports tomorrow night, I’m more inclined to think the U.S.-listed stock will continue to rebound. It recovered Thursday’s losses on Friday and is also rising in premarket trading tonight. Investment banking fees grew quickly last quarter, and the firm has more projects in its pipeline than before. I think buying ahead of this earnings report still has a chance to continue.
GS closed at $895.32 on Friday, above Wednesday’s close of $887.21. It’s trading around $900 in premarket tonight, with the intraday high of $913 from early October still ahead. This isn’t a major rally, but Friday’s rebound has held for now, and the recent high has yet to be broken. If the stock gives back Friday’s gains tonight, the case for a continued pre-earnings rebound will weaken.
Second-quarter investment banking fees were about $3.4 billion, up 55% year over year. Revenue from equity underwriting, debt underwriting, and M&A advisory all increased, and the investment banking pipeline also grew from the end of the first quarter. A larger pipeline creates the potential for fees to keep growing—but projects can be canceled or take a long time to close, so a bigger pipeline doesn’t automatically translate into revenue.
Equities revenue grew 72% year over year in the same quarter. A gain of more than 70% is certainly encouraging, but this business includes trading and financing, so revenue can fluctuate as client activity changes. The rapid growth last quarter doesn’t mean the third quarter will see the same increase. Rather than simply extrapolating from total profits, I’d rather see whether investment banking projects continue to convert into fee revenue.
These business figures are actual second-quarter results released in July; tomorrow night’s report will cover the third quarter. To judge whether GS beats market expectations, we’ll need reliable consensus estimates for comparison. The pre-earnings rebound and the stock’s post-earnings performance should also be considered separately: if growth slows, the share price could still fall after its recent rise.
The earnings report is due around 7:30 tomorrow night, followed by a conference call at 9:30. The pipeline grew last quarter; tomorrow night, the key question is whether those projects have continued to generate revenue.
#GS #美股 #Earnings