2024-03-31 07:45:20 ET
Summary
- Goldman Sachs stock has seen significant price appreciation since my last BUY thesis, outperforming the S&P 500 by also twofold.
- However, the heightened valuation risks and potential profitability pressure are weakening the BUY thesis.
- My specific profit concerns include uncertain macroeconomic conditions and operation costs escalation.
Thesis
My last article , published in Oct. 2023, argued for a BUY thesis on Goldman Sachs Group (GS) when it was trading near its tangible book value at that time. As argued in our article:
Buying good banks such as GS at (or near) their tangible book value ("TBV") is a no-brainer for us. It's a deal where we are only paying for the hard assets (those that can be easily valued and liquidated) and getting everything else for free - such as its future earnings, brand name, customer relationships, et al.
Read the full article on Seeking Alpha
For further details see:
Goldman Sachs: Time To Take Some Profit (Technical Analysis)