New York lender Goldman Sachs outperforms as Wells Fargo Q3 profits tumble 57%

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New York lender Goldman Sachs outperforms as Wells Fargo Q3 profits tumble 57%

On Wednesday, Goldman Sachs Group Inc., the New York City-based American multinational investment bank and financial services company, had reported its best quarterly performance in more than a decade over Q3, 2020, as the Wall St.

lender had reported a 17.5 per cent rise in quarterly return-on-equity, while its lack of big consumer businesses seemed to be shifting from a curse to a blessing. Nonetheless, unlike Goldman Sachs Group Inc., the scandal-hit San Francisco-based lender, Wells Fargo, which had been grappling with a near-zero interest rate alongside a red flag over its consumer businesses, had reported a 57 per cent plunge in quarterly profit over Q3, 2020.

Goldman Sachs outperforms regional peers as trading revenues jump

Besides, the New York City-based American multinational lender had also hoarded a record earnings per share on Q3, 2020, beating an analysts’ estimate by a wider margin, while its buoyant third-quarter performance was almost entirely driven by a 29 per cent leapfrog in trading revenues.

Apart from that, the Apollonian rise in Goldman Sachs quarterly earnings over Q3, 2020, came froth a day after its regional peers like of JPMorgan Chase & Co. had also reported an increase in Q3 profit due to an upsurge in trading revenues.

In tandem, followed by the reveal of its quarterly earnings’ report for the third quarter of the year that ended on September 30, Goldman Sachs’ shares prices rose as much as 0.6 per cent in pre-market trading, while other heavyweight lenders had stomached a mass-scale slump.

However, Goldman Sachs wrapped up Wednesday’s market up by 0.20 per cent to $221.23 per share after surging as much as 1.37 per cent during midday US trading. Concomitantly, according to the Wall St. lender’s quarterly earnings’ report for Q3, 2020, the lender’s net profit had been nearly doubled to $3.5 billion or $9.68 per share, compared to a reading of $1.8 billion recorded at the same time a year earlier.

Nonetheless, analysts had predicted a profit of $5.57 a share. Aside from that, while Goldman Sachs had reported a 30 per cent jump in revenues to $10.8 billion and Wells Fargo had reported a plunge of 14 per cent in revenues, addressing to an out-and-out optimism over Goldman Sachs’ shares prices, a Oppenheimer analyst Chris Kotowski said followed by the reveal of Goldman Sachs’ Q3 earnings’ report, “Goldman remains one of our favourite stocks.

Its loan portfolio is small and of very high quality compared to those of other large bank holding companies. It has minimal exposure to credit cards and small business, which we see as the biggest COVID-19 risks. But it has upside leverage to more active capital markets.