Wednesday, January 6, 2010
Meredith Whitney Cuts Goldman Sachs Estimates Again
Well-known banking analyst Meredith Whitney on Tuesday cut her earnings estimates for Wall Street bank Goldman Sachs for the second time in less than a month.
Shares of Goldman Sachs [GS 174.31 -1.83 (-1.04%) ] fell immediately after the news, but then rebounded higher.
Whitney, head of the Meredith Whitney Advisory Group, lowered her fourth quarter estimate for Goldman Sachs to $5.50 from $6.
She also cut her full-year estimate for Goldman for 2010 from $19.65 to $19.20; her 2011 earnings per share estimate from $20.60 to $20.25; and her 2012 estimate from $21.45 to $21.10.
Whitney had previously cut her estimates for Goldman on Dec. 17.
*when Meredith speaks those that matter tend to listen. Watch for GS to rise up to meet the $200 resistance into the 4Q results which come out on January 21st. But expect her predictions to come true after that and if you want a great trade, SHORT into the news on the results and wait for the opportunity of a better entry point. 2010 and 2011 are very likely to be tough years for all the investment banks, especially compared to 07 and 08 numbers. Even with less competition, banks will have a hard time making the kinds of fees that the market got used to. If only for the simple reason that there just isn't enough business and there won't be for quite some time. That being said, I am sure, like Buffetts sell everything to purchase BNSF cuz I got the government contracts in the bag, I have little doubt that GS et al will figure out a new dog to sell before too long and everyones short lived memories of today will be even shorter come tomorrow.