GS Stock Slides Despite Closing a $9.7 Billion Private Equity Fund 

Goldman Sachs GS Stock NYSE:GS

GS stock was trading at $289.27 as of 02:00 PM EDT.

Private equity fund West Street Capital Partners VIII was closed by Goldman Sachs (NYSE:GS) Asset Management at $9.7B, much more than its initial target, the company said in a statement on Tuesday.

With an average investment size of $300 million, the fund will primarily target investments in the upper mid-market that are control-oriented. Financial & Business Services, Healthcare, Consumer, Technology, and Climate Transition are among the industries in which the fund is anticipated to make investments.

WSCP VIII has already made investments in a number of businesses, including LRQA, a U.K.-based global provider of assurance, inspection, and consulting services, Norgine, a European specialty pharmaceutical company; Nippo Corporation, a road paving business in Japan; Parexel, a global contract research organization; MDVIP, a membership-based healthcare platform in the U.S.; and Norgine. Private credit manager Varagon Capital Partners received a preferred equity investment from Goldman Sachs (NYSE:GS) Asset Management in June.

Goldman Sachs Reports An Impressive Second Quarter Earnings

GS stock/Earnings Outlook

With a P/E ratio of 6.3x, The Goldman Sachs Group, Inc. (NYSE:GS) is a very appealing investment. We’d need to go a little further to see if the drastically lowered P/E has a valid justification, though.

Given that the majority of other companies have been experiencing positive earnings growth while Goldman Sachs Group has recently had its earnings decline, the company may be doing better. The P/E has been depressed since it appears that many people anticipate the gloomy earnings performance to continue. You would hope that this isn’t the case if you still like the firm so that you can possibly buy some stock when it’s undervalued.

How Is the Growth Trend for the Goldman Sachs Group?

To be considered acceptable, a company’s P/E ratio, like Goldman Sachs Group’s, must significantly underperform the market. Retroactively, the company’s bottom line experienced a disappointing 19% decline during the previous year. Despite its unsatisfactory short-term performance, EPS has increased by an excellent 100% overall over the past three years. Despite the rough ride, it’s still fair to argue that the company’s recent earnings growth has been more than sufficient.

In terms of the prognosis, the company’s earnings are expected to decline by 3.5% annually over the next three years, according to analysts tracking the business. That’s a disappointing result considering that the market is expected to increase by 9.6% annually.

Featured Image-  Megapixl @ Burdun

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