Goldman Sachs profit misses estimates on weak equity trading

Earnings per share fell to $10.81 from $12.08 a year earlier. Analysts on average had expected a profit of $11.76 per share, according to Refinitiv data.

Goldman Sachs Group Inc reported fourth-quarter profit on Tuesday that missed market expectations as weak trading activity overshadowed a bumper year for mergers and acquisitions for Wall Street's premier investment bank, sending its shares down 2%.

For the quarter ended Dec. 31, Goldman's trading unit reported lower profit compared to last year as a more stable economy resulted in lower volatility and fewer swings in financial markets. Net earnings applicable to common shareholders fell to $3.81 billion in the quarter ended Dec. 31, from $4.36 billion the same period a year earlier. Earnings per share fell to $10.81 from $12.08 a year earlier.

Analysts on average had expected a profit of $11.76 per share, according to Refinitiv data. However, Goldman reported a 45% rise in investment banking revenue to $3.80 billion in the quarter.

Its top rainmakers raked in record fees from advising on some of the largest mergers, initial public offerings and deals involving special purpose acquisition companies (SPACs) during a year in which global deal volumes breached $5 trillion for the first time. Goldman comfortably topped the league tables for worldwide M&A advisory, according to Refinitiv data, to maintain its dominance in the world of dealmaking. The league tables rank financial services firms on the amount of M&A fees they generate.

 

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