I recommended against buying this one on the earnings announcement and now believe it will land in the 135-145 range. No one ever got hurt waiting for a pullback.
The selloff in shares of Goldman and its peers last week could represent a buying opportunity. The major firms remain highly profitable and they've already curbed their proprietary trading. Morgan Stanley and JPMorgan are largely out of proprietary trading, while Goldman is believed to have scaled back its Special Situations Group, which invests firm capital around the globe.
On a sum-of-the-parts basis, Goldman looks intriguing because of the value of its nontrading operations, including Goldman Sachs Asset Management, which runs $871 billion and could be worth $15 billion. If Goldman's investment-banking advisory were spun off and got the high valuation of banking boutique Greenhill (GHL), it could be worth $15 billion, too. That suggests investors are paying about book value for the rest of the firm, whose market value is $90 billion.
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clipped from online.barrons.com
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