Connect with us

First News in the World

Goldman’s earnings blow past estimates as investment banking revenue boosted by strong IPO market

Goldman's earnings blow past estimates as investment banking revenue boosted by strong IPO market


Goldman’s earnings blow past estimates as investment banking revenue boosted by strong IPO market

Goldman Sachs on Tuesday reported second-quarter earnings that blew past Wall Street expectations, propelled by strong performance in investment banking amid a robust IPO market.Here are the numbers:Earnings: $15.02 per share vs. $10.24 expected by analysts polled by Refinitiv. A year earlier Goldman recorded earnings per share of $6.26 (53 cents per share if accounted for costs related to the 1MDB settlement.)Revenue: $15.39 billion vs. $12.17 billion expectedShares of Goldman were flat in morning trading following the earnings release. The stock is already up 45% in 2021 as investors anticipated strong results amid the economic comeback from the pandemic.Goldman’s investment banking segment posted its second-highest revenue quarter ever, behind the first quarter of 2021, as a booming IPO market boosted its equity underwriting.Companies are rushing to go public this year to take advantage of a stock market at record highs. Capital raised via traditional IPOs in 2021 totaled a record-breaking $135 billion, far surpassing a five-year average of only $53 billion annually, according to FactSet.Goldman’s net revenues from investment banking totaled $3.61 billion, ahead of FactSet’s consensus estimate of $3 billion. The backlog increased significantly from the end of 2020, ending the second quarter at a record level, the bank said.Year to date, the New York-based bank ranked number one in mergers and acquisitions globally, worldwide equity and equity-related offerings, common stock offerings and initial public offerings.Goldman’s trading businesses saw an expected slowdown as the boom from pandemic-induced volatility started to fade. Net revenues totaled $4.90 billion in the last quarter, compared with $7.58 billion in the first quarter of 2021. The sum was split between $2.23 billion in equities trading and $2.58 billion in fixed income. Both figures came in slightly above FactSet estimates.Its asset management unit generated record revenues of $5.13 billion in the second quarter, boosted by record sales from equity investments.Goldman also announced that its board approved a planned 60% increase in the quarterly dividend to $2 per share beginning in the third quarter.JPMorgan Chase also reported second-quarter profit and revenue that exceeded analysts’ expectations as the banking giant released money set aside for loan losses.Enjoyed this article?For exclusive stock picks, investment ideas and CNBC global livestreamSign up for CNBC ProStart your free trial now

Source link

Continue Reading
You may also like...
Click to comment

Leave a Reply

Your email address will not be published.


To Top
error: Content is protected !!