News

Goldman Sachs and Morgan Stanley Lower Earnings Estimates

1 Mins read

Jefferies analyst Daniel Fannon has revised his earnings estimates for Goldman Sachs Group Inc. and Morgan Stanley ahead of their second-quarter updates. Fannon cites a decline in investment banking and sales and trading as the reason for the adjustment.

Goldman Sachs

Fannon has lowered his second-quarter profit view for Goldman Sachs by 56% to $3.82 per share, which is below the consensus estimate of $4.73 per share. Lower deal-making volume is primarily responsible for the decline in estimates. However, Fannon notes that equity capital markets have provided some modest support for the bank.

Additionally, Goldman Sachs is expected to face approximately $1 billion in commercial real estate and goodwill impairments. There are also reports suggesting that the bank is exploring strategic alternatives for its consumer banking units, including a potential sale of its credit card alliance with Apple Inc. Fannon believes the bank may report a goodwill impairment of around $500 million related to its GreenSky consumer lending business amid ongoing sales efforts for the unit.

Morgan Stanley

Fannon has reduced his second-quarter profit view on Morgan Stanley by 32% to $1.17 per share, slightly below the consensus estimate of $1.22 per share. While lower deal-making volume is again a contributing factor, the bank is also expected to incur severance costs.

Stock Performance

In premarket trades, shares of Goldman Sachs are up fractionally, while Morgan Stanley is seeing a 0.3% gain in value.

Related posts
News

The Largest Deal of the Year: BlackRock Acquires TechBerry

1 Mins read
BlackRock is concluding its acquisition of TechBerry, which has already been named one of the largest deals of the year. The substantial…
News

Banking Regulations for Preventing Failures

2 Mins read
Banking regulators have the power to prevent future bank collapses, according to a panel of banking experts who emphasized the importance of…
News

Dave's Strong Q4 Performance

1 Mins read
Shares of Dave surged on Tuesday following the digital bank’s announcement of a profitable fourth quarter earlier than expected, with a positive…

Leave a Reply

Your email address will not be published. Required fields are marked *

6 + 1 =