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Time to Buy Goldman Sachs (GS) or BlackRock (BLK) Stock This Earnings Season?
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Among the broader Zacks Finance sector, investment management conglomerates BlackRock (BLK - Free Report) and Goldman Sachs (GS - Free Report) may be on investors' minds this earnings season.
With BlackRock recently reporting its third-quarter results last Friday and Goldman Sachs set to release its Q3 report on Tuesday, let's see if now is a good time to buy stock in either of these finance leaders.
Recent Performance & Valuation
BlackRock and Goldman Sachs stock have not been immune to the macroeconomic fears among financials this year as BLK shares are down -10% YTD and GS is down -8% with both trailing the Zacks Finance sectors' +2% and the S&P 500’s +14%.
However, as renowned finance leaders investors may be eying this year's drop in BlackRock and Goldman Sachs stock as an opportunity. This may especially be true in regards to Goldman Sachs stock as over the last three years GS shares still have a total return of +64% when including dividends to easily top BLK’s +8%, the Zacks Finance sectors' +34%, and the benchmark's +33%.
Image Source: Zacks Investment Research
Furthermore, BlackRock and Goldman Sachs stock look fairly valued at current levels in terms of price-to-earnings valuation. In this regard, Goldman Sachs stock stands out trading at 13X forward earnings with BlackRock shares also trading reasonably at 18X.
Both trade attractively beneath the S&P 500’’s 20.3X with Goldman Sachs stock trading under the Zacks Finance sectors' 14.7X while BlackRock shares are not at a stretched premium.
Image Source: Zacks Investment Research
BlackRock Q3 Review & Outlook
Last Friday, BlackRock was able to crush its Q3 earnings expectations by 29% with EPS at $10.91 compared to estimates of $8.47 a share. This was despite slightly missing top-line expectations by roughly -1% with Q3 sales at $4.52 billion. Still, sales were up 5% from a year ago with earnings rising 14% from the prior year quarter.
Image Source: Zacks Investment Research
BlackRock’s annual earnings are now expected to dip -2% in fiscal 2023 but rebound and jump 12% in FY24 at $38.81 per share. Total sales are projected to be virtually flat this year and rise 10% in FY24 to $19.85 billion.
Image Source: Zacks Investment Research
Goldman Sachs Q3 Preview & Outlook
As for Goldman Sachs much anticipated Q3 results tomorrow morning, earnings are projected to be down -35% at $5.32 a share following a tough-to-compete-against quarter that saw EPS at $8.25. Third-quarter sales are forecasted to drop -8% to $11 billion.
Image Source: Zacks Investment Research
Overall, Goldman Sachs’ annual earnings are forecasted to dip -21% this year but stabilize and soar 39% in FY24 at $32.89 per share. Total sales are expected to dip -4% in FY23 but rebound and rise 12% in FY24 to $50.82 billion as the company looks to regain its post-pandemic mojo.
Image Source: Zacks Investment Research
Solid Dividends
Dividends are always a lucrative bonus to investors and these finance giants have yields that easily top the S&P 500”s 1.48% average. Goldman Sachs’ 3.56% annual dividend yield tops BlackRock’s 3.19% but both edge the Zacks Finance sectors' average of 2.55%.
Image Source: Zacks Investment Research
Bottom Line
At the moment Goldman Sachs and BlackRock’s stock both land a Zacks Rank #3 (Hold). While there could be better buying opportunities ahead these investment management leaders should be able to sustain their robust top and bottom lines despite broader fears among financials. Plus, their valuations are reasonable and it may be worth holding positions as Goldman Sachs and BlackRock stock should remain viable investments for 2023 and beyond.
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Time to Buy Goldman Sachs (GS) or BlackRock (BLK) Stock This Earnings Season?
Among the broader Zacks Finance sector, investment management conglomerates BlackRock (BLK - Free Report) and Goldman Sachs (GS - Free Report) may be on investors' minds this earnings season.
With BlackRock recently reporting its third-quarter results last Friday and Goldman Sachs set to release its Q3 report on Tuesday, let's see if now is a good time to buy stock in either of these finance leaders.
Recent Performance & Valuation
BlackRock and Goldman Sachs stock have not been immune to the macroeconomic fears among financials this year as BLK shares are down -10% YTD and GS is down -8% with both trailing the Zacks Finance sectors' +2% and the S&P 500’s +14%.
However, as renowned finance leaders investors may be eying this year's drop in BlackRock and Goldman Sachs stock as an opportunity. This may especially be true in regards to Goldman Sachs stock as over the last three years GS shares still have a total return of +64% when including dividends to easily top BLK’s +8%, the Zacks Finance sectors' +34%, and the benchmark's +33%.
Image Source: Zacks Investment Research
Furthermore, BlackRock and Goldman Sachs stock look fairly valued at current levels in terms of price-to-earnings valuation. In this regard, Goldman Sachs stock stands out trading at 13X forward earnings with BlackRock shares also trading reasonably at 18X.
Both trade attractively beneath the S&P 500’’s 20.3X with Goldman Sachs stock trading under the Zacks Finance sectors' 14.7X while BlackRock shares are not at a stretched premium.
Image Source: Zacks Investment Research
BlackRock Q3 Review & Outlook
Last Friday, BlackRock was able to crush its Q3 earnings expectations by 29% with EPS at $10.91 compared to estimates of $8.47 a share. This was despite slightly missing top-line expectations by roughly -1% with Q3 sales at $4.52 billion. Still, sales were up 5% from a year ago with earnings rising 14% from the prior year quarter.
Image Source: Zacks Investment Research
BlackRock’s annual earnings are now expected to dip -2% in fiscal 2023 but rebound and jump 12% in FY24 at $38.81 per share. Total sales are projected to be virtually flat this year and rise 10% in FY24 to $19.85 billion.
Image Source: Zacks Investment Research
Goldman Sachs Q3 Preview & Outlook
As for Goldman Sachs much anticipated Q3 results tomorrow morning, earnings are projected to be down -35% at $5.32 a share following a tough-to-compete-against quarter that saw EPS at $8.25. Third-quarter sales are forecasted to drop -8% to $11 billion.
Image Source: Zacks Investment Research
Overall, Goldman Sachs’ annual earnings are forecasted to dip -21% this year but stabilize and soar 39% in FY24 at $32.89 per share. Total sales are expected to dip -4% in FY23 but rebound and rise 12% in FY24 to $50.82 billion as the company looks to regain its post-pandemic mojo.
Image Source: Zacks Investment Research
Solid Dividends
Dividends are always a lucrative bonus to investors and these finance giants have yields that easily top the S&P 500”s 1.48% average. Goldman Sachs’ 3.56% annual dividend yield tops BlackRock’s 3.19% but both edge the Zacks Finance sectors' average of 2.55%.
Image Source: Zacks Investment Research
Bottom Line
At the moment Goldman Sachs and BlackRock’s stock both land a Zacks Rank #3 (Hold). While there could be better buying opportunities ahead these investment management leaders should be able to sustain their robust top and bottom lines despite broader fears among financials. Plus, their valuations are reasonable and it may be worth holding positions as Goldman Sachs and BlackRock stock should remain viable investments for 2023 and beyond.