On Friday, Oppenheimer reduced its price target for Goldman Sachs (NYSE:GS) shares to $504 from the previous $517, while maintaining an Outperform rating on the stock. The adjustment comes as the firm revises its second-quarter earnings per share (EPS) estimate for the financial giant downward to $9.01 from $10.05.
The revision was attributed to anticipated lower trading revenue. Oppenheimer's initial forecast had assumed a roughly 10% increase in trading revenue for the second quarter of 2024. However, this expectation has been moderated to a 5% rise, which the firm considers a more realistic average within the range of guidance provided.
This recalibration of expectations by Oppenheimer reflects a more conservative outlook on Goldman Sachs' trading revenue performance. The firm's analysis suggests that the previous estimates may have been overly optimistic in the context of the current financial environment.
The updated stock price target of $504 indicates Oppenheimer's continued confidence in the stock, despite the lowered earnings forecast. The Outperform rating suggests that the firm still sees Goldman Sachs as a favorable investment compared to its peers, albeit with adjusted profit expectations.
Investors and market watchers will be keeping a close eye on Goldman Sachs' upcoming quarterly financial report to assess the accuracy of these revised projections and the overall health of the company's trading operations.
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