Published: Monday, April 13, 2026 · 6:19 PM | Updated: Monday, April 13, 2026 · 6:19 PM
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Goldman Sachs reported good but not great first-quarter earnings on Monday, sending shares lower to kick off the trading week. Renewed tensions in the war with Iran aren’t helping either, but our reasons for owning the stock are all still intact. Revenue in the first quarter ended March 31 advanced 14.4% to $17.23 billion, outpacing the $16.97 billion expected by LSEG. Earnings per share (EPS) jumped 24.3% year over year to $17.55, outpacing estimates of $16.30, according to LSEG. Goldman shares were down a little over 2% in afternoon trading, at roughly $886 apiece. At session lows, shares were down over 4.5%. The broader market has also steadily rallied after opening the day modestly lower. That improvement in the overall market, as investors look through the weekend’s unsuccessful peace talks, has certainly helped Goldman shares climb off the lows. GS YTD mountain Goldman’s year-to-date stock performance. Bottom line We’re unfazed by the pullback in Goldman shares and see it as a buying opportunity — once the dust settles in this week’s jam-packed bank earnings calendar. On the Morning Meeting, Jim Cramer explained why he isn’t recommending jumping in to buy Monday. He said he prefers to wait a few days for the other banks to report and for Goldman’s stock to stabilize. Then, he said, he would take action. Clearly, this is not the price action we want to see when one of our companies reports, though it does make us feel pretty good about last week’s sale . So, why are we having such a positive outlook despite the imperfect results? There was a lot to like under the hood, from strength in its most consequential segment, which houses its investment banking operations, to encouraging scores on key banking metrics (more on those in a moment). That gives us confidence that Goldman is on strong footing, especially if the surge in oil proves temporary and the war with Iran manages to wind down on a timeline counted in weeks, rather than months. If we learned anything since the start of this conflict, it’s that the United States’ economy is far better equipped to handle price spikes in oil than we thought. In fact, at the end of March, analysts at Goldman Sachs said, “Our economists expect real US GDP growth will exceed 1% this year even in a severely adverse scenario where crude oil spikes above $150, the disruption of flow through the Strait of Hormuz lasts until May, and production ‘scarring’ impacts supply even after flows begin to normalize.” So, unless you are of the view that this gets far worse before it gets better, it would be wise to look at this as an opportunity because any calming of tensions should help unleash the bank’s significant backlog for deals. And it’s also worth noting that there were a few large deals announced toward the end of the first quarter despite the conflict still raging, hopefully an encouraging harbinger for what’s to come when tensions subside. Additionally, there’s been some evidence of a pickup in IPO filings already in April. The crux of our Goldman thesis is its dealmaking prowess at a time when the Trump administration is taking a more accommodative approach to mergers than its predecessor, and the IPO market is thawing. “While market conditions hampered execution for IPOs and sponsor activity broadly, we believe that activity levels will rebound once conditions stabilize,” CEO David Solomon said Monday on the conference call. “As you remember, our backlog closed 2025 at its highest level in four years. Even with exceptionally strong revenue production, our quarter-end backlog remained extraordinarily robust”. Asked about the M & A environment given the geopolitical turmoil, Solomon doubled down on his bullish outlook. Here’s an extended look at Solomon’s response: “The environment for investment banking activity continues to be incredibly robust, particularly, you know, M & A activity. And I do think, as I talk to CEOs, of course, they’re watching what’s going on geopolitically. But that’s also balanced by the fact that they see an opportunity during this period of time to drive scale and scale creation in businesses with significant technological change, and they are focused on that. And that candidly trumps some of the geopolitical risk because they have the opportunity to do consolidating trades… And so we continue to see significant activity on the M & A front. … Unless the overall environment got much, much worse, I don’t see that slowing based on what we see at the moment. That said, there is no question that with the conflict in the Middle East, IPO activity slowed a little bit, particularly in March. I do think there’s a very full pipeline. And at the end of the day, equity markets have been extremely resilient. And if that resilience continues, I do think you’ll see IPO activity accelerate again.” We already called out the stronger-than-expected sales and earnings, both of which were the second-highest results in the firm’s history. There’s plenty more to like, though. For example, the bank’s efficiency ratio ticked lower versus the year-ago period to 60.5% (lower is better here), matching expectations. This speaks to the potential of future earnings, so we want to see it keep moving lower. The ratio is calculated by dividing the bank’s expenses by its revenues. Furthermore, the firm’s return on tangible common equity came in materially better than expectations, advancing 330 basis points year over year. A basis point equals 0.01%. As for the CET1 ratio , a measure of a bank’s financial strength, it did miss expectations at 12.5%. Nevertheless, that is still comfortably above the the 10.9% minimum required by U.S. banking regulators, indicating plenty of room left for Goldman to make growth-oriented investments and return cash to shareholders. On the topic of shareholder returns, Goldman repurchased $5 billion worth of stock in the first quarter, a notable step up from the roughly $3 billion we’ve seen in recent periods. Given the results, we’re reiterating our price target of $1,050 a share. We are keeping our 2 rating, which means buy on a pullback. We’ve had our 2 rating in place since our trim last week. Segment Results Goldman’s global banking and markets division reported record quarterly revenue, increasing 18.6% year over year to $12.74 billion, well ahead of expectations. Revenue from investment banking, the largest segment, surged 48% year over year, driven by 89% growth in advisory revenues, and compounded by a 45% increase in equity underwriting fees and an 8% increase in debt underwriting. Equities revenue increased 27% year over year to a new firm record, as equity financing revenue hit a new record. Fixed income, currency, and commodities (FICC) revenue was one of the blemishes in the report, coming in at $4.01 billion versus the $4.83 billion consensus, according to FactSet. Overall, FICC revenue fell 10% year over year. However, it was up 29% sequentially as uncertainty stemming from the Iran war — the software and private-credit concerns that have driven markets this year — resulted in active client portfolio repositioning. On the call, Solomon said that while the adoption of AI may be roiling certain parts of the market (think enterprise software), it’s also resulting in companies turning to Goldman to help them with strategic transactions. Examples called out by Solomon include Unilever’s $43 billion deal with McCormick , Sysco’s deal to purchase Jetro, and Devon Energy’s merger with Coterra Energy . All three of those deals were announced in Q1. Turning to the asset and wealth management division , revenue advanced 10% year over year to $4.08 billion, though it did come up a bit short of the $4.36 billion consensus. Compared with the year-ago period, the segment benefited from a 14% increase in management and other fees, driven by an increase in assets under supervision (AUS). AUS increased by $44 billion during the quarter, resulting in quarter-end assets under supervision of a record $3.65 trillion. Private banking and lending revenue, meanwhile, fell 12% year over year as deposit spreads on Marcus banking accounts narrowed, though higher deposit balances did help slightly offset the rate impact. Revenues in Goldman’s platform solutions segment , by far the smallest of the three, were again down materially year over year to $411 million. However, as a reminder, that’s because the firm previously wisely sold its Apple credit card business to JPMorgan, part of its general retreat from mass-market consumer ambitions. (Jim Cramer’s Charitable Trust is long GS. See here for a full list of the stocks.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . 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