Have you been eager to see how The Goldman Sachs Group, Inc. (GS) performed in Q4 in comparison with the market expectations? Let’s quickly scan through the key facts from this New York-based investment bank’s earnings release this morning:
An Earnings Beat
Goldman came out with earnings per share of $4.38, beating the Zacks Consensus Estimate of $4.29.
Results were aided by lower expenses, however weak top line was on the downside.
How Was the Estimate Revision Trend?
You should note that the earnings estimate revisions for Goldman depicted pessimism prior to the earnings release. The Zacks Consensus Estimate has moved 2.3 % lower over the last 7 days.
However, Goldman has an impressive earnings surprise history. Before posting an earnings beat in Q4, the company delivered positive surprises in the prior three quarters as well. Overall, the company surpassed the Zacks Consensus Estimate by an average of 25.95% in the trailing four quarters.
Revenue Came In Lower Than Expected
Goldman posted revenues of $7.7 billion, which came slightly lower than the Zacks Consensus Estimate of $7.8 billion. Also, it compared unfavorably with the year-ago number of $8.9 billion.
Key Takeaways
Total operating expenses: $4.48 billion, down 14% year over year.
Assets under Supervision: $1.18 trillion, up 13% year over year.
In an effort to trim activities with lower returns, Goldman reduced total assets by $55 billion to $856 billion in 2014 and improved pre-tax margin to 35.8%.
What Zacks Rank Says
The estimate revisions that we discussed earlier have driven a Zacks Rank #3 (Hold) for Goldman. However, since the latest earnings performance is yet to be reflected in the estimate revisions, the rank is subject to change. Now, it all depends on what sense the just-released report makes to the analysts.
How the Market Reacted So Far
Following the earnings release, Goldman shares were down almost 1.5% in the pre-trading session. This is in line what the stock witnessed in the prior-day’s session. Clearly, the initial reaction shows that the investors have not considered the results in their favor. However, the full-session’s price movement may indicate a different picture.
Check back later for our full write up on this Goldman earnings report!
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