Goldman Sachs Group Inc (NYSE:GS)’s second-quarter earnings doubled thanks to revenue gains from fixed income, currency and commodity trading. The top investment bank posted a 108 percent increase in its second-quarter earnings at $3.70 per share as against $1.78 reported a year ago. This surge was bolstered by the payment of preferred dividends.
Strong Trading Revenues For Goldman Sachs
The investment bank’s fixed income, currency and trading revenue topped $2.46 billion against $2.19 billion posted a year ago, and $3.22 billion in the previous quarter.
What does value investing really mean? Q1 2021 hedge fund letters, conferences and more Some investors might argue value investing means buying stocks trading at a discount to net asset value or book value. This is the sort of value investing Benjamin Graham pioneered in the early 1920s and 1930s. Other investors might argue value Read More
Goldman Sachs Group Inc (NYSE:GS)’s net interest income grew 30 percent to $8.61 billion.
The investment bank’s revenue and earnings per share beat analysts’ estimates of $8 billion and $2.82 per share respectively.
Strong Investment Banking Revenues
Despite crawling mergers and acquisition business, Goldman Sachs Group Inc (NYSE:GS) reported 29 percent increase in its revenue from investment banking. This arm posted revenue of $1.55 billion, as against $1.2 billion logged a year earlier and $1.57 billion posted in the first quarter.
Aided by strong leveraged finance activity, Goldman Sachs’ debt underwriting revenue saw 40 percent increase from a year earlier. Besides, better IPO activity enabled its equity underwriting revenue rising over 55 percent.
Equity And Financial Advisory Revenue Grow
Goldman Sachs’ total equities revenue grew to $1.85 billion as against $1.7 billion logged last year and $1.92 billion recorded during the first quarter.
The investment bank’s revenue from financial advisory work saw 3.6 percent growth from a year-ago period, though it saw flat growth from the previous quarter.
Goldman Sachs results echoes solid results announced by JPMorgan Chase & Co. (NYSE:JPM), Wells Fargo & Co (NYSE:WFC) and Citigroup Inc (NYSE:C). The country’s other two top banks Bank of America Corp (NYSE:BAC) and Morgan Stanley (NYSE:MS) are set to release their second quarter numbers Wednesday and Thursday.
As reported earlier, Goldman Sachs Group Inc (NYSE:GS)’s earnings and revenue had beaten consensus estimates for five quarters running before the recent earnings announcement.
Regulatory Initiatives On Trading And Investment Units
The recent regulatory initiatives made trading and investment units more expensive. However, Goldman Sachs Group Inc (NYSE:GS) logged 10.5 percent return on equity, beating 8 percent estimated by analysts. Analysts’ projected 10 percent benchmark to break-even to meet a bank’s cost of capital.