GS

We rate GOLDMAN SACHS GROUP INC (GS) as a Reduce with a composite score of 49.8/100 at a current price of $901.38. The quantitative profile shows weakness across multiple dimensions, suggesting limited upside potential and elevated risk of underperformance relative to peers over the next 12 months.

The rating is primarily driven by strength in momentum (82th percentile) and stability (45th percentile), which together account for the majority of the composite score. Offsetting weakness in investment (26th percentile) and quality (28th percentile) tempers our overall conviction. We assign a No Moat rating (27/100), Very High uncertainty, and Standard capital allocation.

Key items to watch: balance sheet deleveraging progress. Any material change in these dynamics could warrant a reassessment of our rating. The moat trend is stable, which suggests the competitive landscape is stable for now.

GOLDMAN SACHS GROUP INC holds a top-quartile position (#0 of 50) within the Finance, Insurance, And Real Estate sector, based on our composite quantitative scoring across quality, value, momentum, and stability factors. The composite score of 49.8/100 places it at rank #2030 in our full 7,333-stock universe. As a mega-cap company with a $241.1B market capitalization, GOLDMAN SACHS GROUP INC benefits from significant scale, distribution networks, and brand recognition that smaller competitors cannot easily replicate.

The near-term outlook is constructive, with revenue growing at 19% and momentum in the 82th percentile confirming positive market sentiment and institutional accumulation. The combination of strong top-line growth and favorable price dynamics suggests the company is executing well on its growth strategy. Investment factor at the 26th percentile indicates reinvestment patterns that investors should monitor for sustainability.

The margin cascade tells an important story: gross margins of 0% (-76.5pp vs sector) narrow to operating margins of 35% (+17.6pp vs sector) and net margins of 26.9%, yielding a gross-to-net conversion rate of N/A%. The significant margin erosion from gross to net suggests elevated operating expenses, high interest costs, or other structural drags that warrant monitoring.

At a current price of $901.38, GOLDMAN SACHS GROUP INC is trading near fair value based on current fundamentals. Our value factor score of 40/100 reflects a composite assessment across multiple valuation metrics including price-to-earnings, price-to-book, EV/EBITDA, and price-to-sales ratios relative to both sector peers and the broader market. Valuation metrics are mixed, with no strong signal of mispricing in either direction.

The stock currently trades at a P/E of 17.8x (a 49% premium to the sector median of 11.9x), EV/EBITDA of 12.4x (at a premium), P/B of 2.2x, P/S of 4.8x. The above-sector P/E multiple suggests the market is pricing in superior growth or quality, which our analysis finds only partially justified by current fundamentals.

We assign a Very High uncertainty rating to GOLDMAN SACHS GROUP INC. The stock exhibits multiple compounding risk factors: elevated market sensitivity (beta of 1.35), significant leverage (1353% debt-to-equity), weak quality scores (28th percentile). The extreme uncertainty around future cash flows makes precise valuation difficult, and the range of outcomes is exceptionally wide. Only investors with high risk tolerance and extended time horizons should consider this name.

Specific risk factors that inform our assessment include: elevated market sensitivity (beta of 1.35); significant leverage (1353% debt-to-equity); weak quality scores (28th percentile). Each of these factors independently widens the distribution of potential outcomes, and in combination they create a risk profile that demands careful position sizing. The stability factor at the 45th percentile and quality factor at the 28th percentile provide a quantitative summary of the overall risk landscape.

Key risk mitigants include: large-cap scale ($241.1B) provides resilience. These factors partially offset the identified risks and provide downside protection in adverse scenarios. On balance, the risk-reward profile warrants caution and disciplined position management.

We rate GOLDMAN SACHS GROUP INC's capital allocation as Standard. Management has shown adequate — though not exceptional — stewardship of shareholder capital. Returns on equity stand at 12.5%, and the balance sheet is managed within acceptable parameters (D/E: 1353%). Exemplary allocators typically sustain ROE above 20% and D/E below 50%; GOLDMAN SACHS GROUP INC falls short on at least one dimension.

There is room for improvement in optimizing the capital structure or enhancing shareholder returns. The 1.63% dividend yield provides some income return, but the overall capital allocation framework would benefit from either higher reinvestment returns, improved balance sheet efficiency, or increased shareholder distributions. We will monitor for signs of strategic improvement that could warrant an upgrade.

In summary, GOLDMAN SACHS GROUP INC receives a Reduce rating with a composite score of 49.8/100 (rank #2030 of 7,333). Our quantitative framework assigns a No Moat (27/100, trend: stable), Very High uncertainty, and Standard capital allocation. The average factor score across quality, value, momentum, stability, and investment is 44/100.

Our analysis does not support a constructive view on GOLDMAN SACHS GROUP INC at this time. The combination of limited competitive advantages, very high uncertainty, and standard capital allocation suggests unfavorable risk-reward at current levels. We recommend investors avoid new positions and existing holders consider reducing exposure.