Analyst sets optimistic $700 price target for Goldman Sachs

In a recent report, Ebrahim H. Poonawala of BofA Securities reaffirmed a Buy rating for Goldman Sachs Group, indicating a price target of $700 for the stock. This recommendation is attributed to Goldman Sachs' strong fundamentals and adaptability, especially amid anticipated regulatory changes. The analyst highlighted how the firm has shown exceptional resilience in capital markets, suggesting that it is well-positioned for long-term growth. The report illustrates how trading revenues for Goldman Sachs have flourished, maintaining growth in six out of seven recent years, with a notable context shift in macroeconomic conditions. Furthermore, Poonawala pointed to Goldman Sachs' Asset & Wealth business, expected to contribute around 25% to EPS, which is predicted to achieve over 25% ROE. This growth is driven by ongoing fundraising momentum and operational efficiency as funds are deployed. The firm's experience in private credit, cultivated since the mid-1990s, exemplifies its ability to navigate potential risks while maintaining superior client selection. Amid the changing regulatory landscape, Goldman Sachs stands as a beneficiary of a more balanced regulatory environment, which may lower CET1 capital requirements and boost ROE significantly. Shifts in liquidity rules could enhance revenue growth through greater flexibility in U.S. Treasury market intermediation. Overall, Poonawala's projections for fiscal 2025 include estimated revenues of $55.59 billion and earnings per share of $44.65, underscoring the firm's strong position within the financial markets.