Goldman Sachs Group may be 17% undervalued following talk of CEO succession, according to an Excess Returns valuation model. The stock last closed at US$882.59, and the model's projections put Goldman Sachs Group's estimated intrinsic value meaningfully above that price, with a bull case seeing the shares 21% undervalued. The model starts from book value of $362.05 per share and a stable book value estimate of $406.03, with analysts pointing to stable EPS around $75.58 per share, a cost of equity of $38.02 per share, an excess return of $37.57 per share, and an average return on equity of 18.62%. Dividend assumptions of $20.70 per share in annual payouts and long run dividend growth of 3.7% point to cash distributions the model treats as reasonably supported by expected earnings. The stock has returned about 204.5% over the past 3 years, and recent news around leadership succession, executive equity awards tied partly to stock performance, and moves into tokenized trading and asset and wealth management has kept focus on how efficiently Goldman Sachs can deploy capital. A bear case holds that rising digitization and fintech disruptors will erode margins across investment banking, trading, and wealth management, leaving the stock roughly fairly valued.
Goldman Sachs Group IncExcess Returns valuation model sees Goldman Sachs ~17% undervalued, with intrinsic value above the $882.59 close.
