Bank and Tech Stocks Headline Earnings

Trey Thoelcke

posted: 44 DAYS 13 HOURS AGO

Text SizeAAA

Goldman Sachs upgraded the banking sector last week, and this coming week we'll get a chance to see whether Goldman and other big banks reporting third quarter results will live up to the expectations of analysts surveyed by Thomson Reuters.

New York-based Goldman Sachs Group Inc. (NYSE: GS) looks set to be this week's earnings game winner. Analysts expect this dividend-paying company to report a third-quarter profit of $4.24 per share, which is 57.3% higher than in the same period of last year. Revenue for the period that ended in September is expected to be $11.0 billion. So far, the full-year forecast is for $17.74 per share on $44.6 billion.

Goldman Sachs earnings have been better than expected in four of the past five quarters, beating estimates by as much as $1.75 per share. The long-term EPS growth forecast is 12.5%, which is better than that of rival Morgan Stanley (NYSE: MS). Goldman Sachs's earnings multiple is 10x, and its net cash flow from operations swung into the black in the second quarter. The First Call consensus recommendation has been to buy GS for more than 90 days, and the mean price target is $202.52. The Motley Fool likes the prospects for higher dividends in the future. Shares have risen 33.4% in the past three months and reached a 52-week high of $192.17 last week.

2009-10-11 11:16:35