Goldman Sachs is a global financial services firm operating four divisions: Investment Banking, Global Markets, Asset Management, and Consumer & Wealth Management, with 46,200 full-time employees and a market cap of $272.38 billion at a current price of $923.29.
GS
· Financial Services · Financial - Capital Markets
· Market cap $272.38B
QuantHub Original Research · Updated 2026-09-25
·
High QualityA-tier business, C-tier valuationCheapIn Buy Zone
GS is 24% below fair value and in its buy zone. Consider adding to your position.
QuantHub Research: Investment Thesis
Investing Phase
Goldman Sachs is a global financial services firm operating four divisions: Investment Banking, Global Markets, Asset Management, and Consumer & Wealth Management, with 46,200 full-time employees and a market cap of $272.38 billion at a current price of $923.29. The business quality is high because of its leading franchise in advisory, underwriting, and trading, evidenced by a 17.0% ROE, a 57.3% TTM gross margin, a 24.8% TTM operating margin, and a 17.8% TTM net margin, alongside a record investment banking backlog and expanding asset and wealth management operations. The stock is mispriced to the downside versus blended fair value: at $923.29 it trades at a 13.21 trailing P/E, 2.31 P/S, and 26.34 EV/EBITDA, which places it in a very expensive regime relative to its five-year historical multiples, yet the fair value estimate of $1162.79 implies 25.9% upside and the analyst consensus is Hold with a $1162.79 average target. The tension is that the most recent quarter showed 22.9% revenue growth and 78.0% earnings growth year over year, but those are single-quarter comparisons driven by unusually favorable market volatility and client activity, and investment banking and trading revenues are inherently cyclical. Free cash flow per share is negative at $-138.34, reflecting balance-sheet and trading-asset dynamics rather than an operating loss, while revenue per share is $399.78. The shares are undervalued versus blended fair value but expensive versus historical multiples, so the risk-reward is balanced rather than compelling.
Goldman trades at 13.21 times trailing earnings, 2.31 times sales, and 26.34 times EV/EBITDA, a very expensive regime relative to its own five-year historical multiples, which is the primary reason the shares screen as expensive on a historical lens. At the same time, the blended fair value estimate of $1162.79 and the analyst consensus target of $1162.79 both imply 25.9% upside from $923.29, so the shares are undervalued versus blended fair value even though they are expensive versus historical multiples. The market appears to be pricing the cyclical peak in trading and investment banking activity, with the most recent quarter's 22.9% revenue growth and 78.0% earnings growth year over year treated as unsustainable rather than as a new baseline. The Hold consensus reflects that tension: analysts acknowledge the record investment banking backlog and expanding asset and wealth management business, but they are unwilling to underwrite the current earnings run-rate at a premium historical multiple. Negative free cash flow per share of $-138.34 and the absence of a forward P/E also limit the clarity investors can get on normalized earnings power.
12–18 Month Outlook
In 18 months, Goldman is likely to be a firm with a normalized but still strong earnings base, where the most recent quarter's 22.9% revenue growth and 78.0% earnings growth year over year are not repeated at that pace because they were driven by elevated volatility and client activity. The investment banking backlog should convert into advisory and underwriting revenue as capital markets activity continues, and the asset and wealth management build-out toward the $750 billion fee-paying alternative AUS target by 2030 should add more durable management fees. The Apple Card transition to Chase over approximately 24 months will continue to reduce Platform Solutions revenue, which already fell 64% year over year to $221 million, but it also removes a source of earnings drag and regulatory complexity. The key question is valuation: at 13.21 times trailing earnings and 26.34 times EV/EBITDA, the shares are expensive versus five-year historical multiples, so even with 25.9% upside to the $1162.79 blended fair value, the stock is likely to trade sideways to modestly higher unless earnings normalize above current expectations or capital returns accelerate. Downside risk is meaningful if trading and issuance activity cools faster than the backlog converts.
Bull vs Bear
Bull Case
The most recent quarter delivered 22.9% revenue growth and 78.0% earnings growth year over year, with Equities up 72% and FICC up 32%, demonstrating the earnings power of the Global Markets franchise when volatility and client activity are elevated.
Goldman carries a record investment banking backlog alongside strong trading and an expanding asset and wealth management business, which supports the durability of fee-based revenue even as transactional revenue normalizes.
The company targets $750 billion of fee-paying alternative assets under supervision by year-end 2030 and expects to raise $75 billion to $100 billion annually, creating a multi-year route to more durable management-fee revenue.
Profitability remains strong with a 17.0% ROE, a 57.3% TTM gross margin, a 24.8% TTM operating margin, and a 17.8% TTM net margin, and the shares trade at 13.21 times trailing earnings, which is not demanding for a franchise of this quality.
Blended fair value of $1162.79 implies 25.9% upside from $923.29, and the analyst consensus target of $1162.79 corroborates that level, suggesting the market is underpaying for the franchise relative to a blended valuation lens.
Bear Case
The most recent quarter's 22.9% revenue growth and 78.0% earnings growth year over year were driven by market volatility and client activity, including 72% Equities growth and 32% FICC growth, and a decline in trading volumes, issuance, spreads, or risk appetite could reverse that benefit rapidly.
The shares trade in a very expensive regime relative to five-year historical multiples at 13.21 times trailing earnings, 2.31 times sales, and 26.34 times EV/EBITDA, exposing the stock to de-rating risk if earnings normalize toward a mid-cycle level.
Investment banking and trading revenues are inherently cyclical, and the current earnings run-rate may not be sustainable, which is consistent with the Hold consensus rating despite the 25.9% upside to the $1162.79 target.
Platform Solutions revenue declined 64% year over year to $221 million in the most recent quarter, and the agreed transition of the Apple Card program and more than $20 billion portfolio to Chase over approximately 24 months creates operational and transition risk until completion.
As a global systemically important bank, Goldman faces capital, stress-test, conduct, consumer, cybersecurity, and market-structure regulation, and future rule changes could constrain capital returns or raise compliance costs.
Leadership & Competitive Position
David Michael Solomon
Tenure8 yrs
Beats guidance75% of qtrs
Capital allocationGood
David Michael Solomon has led Goldman Sachs since 2018, overseeing the firm's four-division structure across Investment Banking, Global Markets, Asset Management, and Consumer & Wealth Management. Under his leadership the firm has emphasized asset and wealth management growth, including the $750 billion fee-paying alternative AUS target for year-end 2030, while managing the wind-down of the consumer platform transition of the Apple Card program and more than $20 billion portfolio to Chase. The firm maintains a 17.0% ROE and a 3.4% stress-capital buffer with an 11.4% CET1 requirement unchanged through September 30, 2027, indicating disciplined balance-sheet management.
Competitive Moat
stable
brandintangible assetsnetwork effects
Goldman is a leading global investment bank with a record investment banking backlog and strong trading and expanding asset and wealth management operations, competing at scale across advisory, underwriting, and global markets. The firm's 46,200 employees and $272.38 billion market cap place it among the largest capital markets franchises.
Competitors: Morgan Stanley (MS), JPMorgan Chase (JPM), Evercore (EVR), Citigroup (C)
Disruption: Medium, because electronic trading, passive investing, and fintech platforms pressure traditional intermediation and asset management fees, though Goldman's institutional franchise and balance sheet provide meaningful insulation.
QuantHub Research
Valuation
Multiple
Current
Median 3yr
Median 5yr
Min 5yr
Max 5yr
P/E
13.21x
16.74x
13.89x
6.34x
16.92x
P/S
2.31x
1.48x
1.76x
1.21x
2.2x
P/FCF
—
—
—
—
—
P/S 2.31x vs 5yr range 1.21-2.2x (P25=1.21x, median=1.76x, P75=2.06x)
Price Outlook (5-Year)
Bear
$930
-0.1%/yr
Base
$1163
4.4%/yr
fair value
Bull
$1395
8.3%/yr
Bear/Base/Bull anchored to QuantHub fair value estimate. Base = headline fair value; Bear −20%; Bull +20%.
Market volatility and client activity boosted the most recent quarter's results, including 72% Equities growth and 32% FICC growth. A decline in trading volumes, issuance, spreads, or risk appetite could reverse this benefit rapidly.
Regulatory and capital requirements
medium
As a global systemically important bank, Goldman faces capital, stress-test, conduct, consumer, cybersecurity, and market-structure regulation. Its 3.4% stress-capital buffer and 11.4% CET1 requirement are unchanged through September 30, 2027, but future rule changes could constrain capital returns or raise compliance costs.
Earnings cyclicality
high
The most recent quarter showed 22.9% revenue growth and 78.0% earnings growth year over year, but investment banking and trading revenues are inherently cyclical and can normalize sharply after unusually favorable market conditions.
Historical-multiple valuation risk
high
Although GS is undervalued versus blended fair value, its 13.21x trailing P/E, 2.31x P/S, and 26.34x EV/EBITDA place it in a very expensive regime relative to five-year historical multiples, exposing the stock to de-rating risk.
Consumer-platform transition
medium
Platform Solutions revenue declined 64% year over year to $221 million in the most recent quarter. Goldman has agreed to transition the Apple Card program and more than $20 billion portfolio to Chase over approximately 24 months, creating operational and transition risk until completion.
Negative free cash flow per share
medium
Free cash flow per share is $-138.34, reflecting balance-sheet and trading-asset dynamics, and with no forward P/E or P/FCF available, investors have limited visibility into normalized cash generation and capital return capacity.
Litigation and conduct exposure
medium
As a global financial institution, Goldman remains exposed to litigation, conduct, and consumer-related regulatory matters that could result in fines, penalties, or reputational damage, and current sources do not indicate these exposures have been resolved.
Growth Engines
Alternatives asset managementscaling
Goldman targets $750 billion of fee-paying alternative AUS by year-end 2030 and expects to raise $75 billion to $100 billion annually, a large and growing pool of private markets capital.
Investment banking backlogmature
A record backlog supports advisory and underwriting revenue as capital markets activity normalizes, though the revenue is inherently cyclical.
Global markets tradingmature
Equities and FICC franchises delivered 72% and 32% growth respectively in the most recent quarter, but trading revenue is volatile and tied to market conditions.
Wealth managementscaling
The Consumer & Wealth Management division provides financial planning, investment management, deposit-taking, and lending to individuals, offering a more recurring revenue stream.
GS versus EVR comparison highlights record investment banking backlog and expanding AWM business
The comparison notes that Goldman's record investment banking backlog, strong trading, and expanding asset and wealth management business could support further upside relative to Evercore, reinforcing the franchise strength narrative.
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QuantHub research is focused on quality businesses with durable competitive advantages — companies we'd want to own for 3–5 years or more. We are not short-term traders. Every analysis is built around a single question: is this a great business available at a reasonable price for a long-term investor?
We start where most analysts finish: the fundamentals. For every company, our AI ingests years of financial statements — revenue, margins, free cash flow, and how the business has been valued by the market across multiple cycles. But numbers alone don't tell you whether a business is worth owning.
The harder work is qualitative. We assess the competitive moat: is it widening or eroding? We read the leadership track record — how capital has been allocated, whether management has earned trust through consistent execution. We look at what the market is afraid of, and whether that fear is priced in fairly or irrationally.
Valuation is always relative. A stock is cheap or expensive compared to its own history. We build scenario matrices anchored to 5-year historical multiples, then ask: what has to go right for the upside case, and what's the floor if it doesn't?
Finally, we write an 18-month forward outlook — not a price target, but a mental model of where this business will be and what the narrative will look like. Every note is dated and versioned. When material facts change, we update the thesis.
Frequently Asked Questions
Is GS undervalued?
Yes, GS appears undervalued at the current price of $935.45, trading below our fair value estimate of $1,162.79 (+24% upside). QuantHub considers this a buy zone.
What is GS's fair value?
QuantHub Research estimates GS's fair value at $1,162.79 based on our proprietary valuation model incorporating historical P/S, P/E, and P/FCF multiples over a 5-year range.
What are the key risks for GS?
Market volatility and activity normalization: Market volatility and client activity boosted the most recent quarter's results, including 72% Equities growth and 32% FICC growth. A decline in trading volumes, issuance, spreads, or risk appetite could reverse this benefit rapidly. Regulatory and capital requirements: As a global systemically important bank, Goldman faces capital, stress-test, conduct, consumer, cybersecurity, and market-structure regulation. Its 3.4% stress-capital buffer and 11.4% CET1 requirement are unchanged through September 30, 2027, but future rule changes could constrain capital returns or raise compliance costs. Earnings cyclicality: The most recent quarter showed 22.9% revenue growth and 78.0% earnings growth year over year, but investment banking and trading revenues are inherently cyclical and can normalize sharply after unusually favorable market conditions.
What is the bull case for GS?
The most recent quarter delivered 22.9% revenue growth and 78.0% earnings growth year over year, with Equities up 72% and FICC up 32%, demonstrating the earnings power of the Global Markets franchise when volatility and client activity are elevated. Goldman carries a record investment banking backlog alongside strong trading and an expanding asset and wealth management business, which supports the durability of fee-based revenue even as transactional revenue normalizes. The company targets $750
How confident is QuantHub in GS?
QuantHub has moderate conviction in GS. Research last updated 2026-09-25.