Is The Goldman Sachs Group, Inc. overvalued?

In our latest published analysis dated 2026-09-23, GS looks meaningfully overvalued. The price recorded at analysis is USD 949 versus our fair value of USD 655; the high endpoint is presented separately as potential value of USD 866. That implies roughly 31.0% downside to fair value at that date.

What is GS's fair value?

Our latest published report, analyzed 2026-09-23, gives GS a fair value of USD 655 and a potential value of USD 866. The conclusion is triangulated across multiple valuation models and weighted by reliability for The Goldman Sachs Group, Inc.'s archetype; it is a dated research output, not a live price.

Our latest published rating for GS, analyzed 2026-09-23, is Sell. The Goldman Sachs Group, Inc. looks meaningfully overvalued at the analysis-date price of USD 949 versus fair value of USD 655; potential value is USD 866. This is research for educational purposes, not personalized investment advice.

What are the biggest risks for GS?

The dedicated bear-case section in our report analyzed 2026-09-23 documents The Goldman Sachs Group, Inc.'s material risks, evidence, thresholds, and thesis-invalidation conditions. Scenario-specific explanations remain in that section so the report does not repeat or decontextualize them elsewhere.

Our latest published rating for GS, analyzed 2026-09-23, is Sell, with a published moat assessment of 7.5/10 (Narrow). It reflects our fair value of USD 655, the potential value of USD 866, and the price recorded at analysis (USD 949).

What archetype is GS?

In the latest published report analyzed 2026-09-23, The Goldman Sachs Group, Inc. is classified as a financial stock. Archetype determines how every downstream parameter — discount rate, terminal growth, deceleration curve, terminal multiple, scenario probability weights, scorecard weights, and which valuation models are prioritized — is calibrated for GS.

GS stock analysis

GS stock analysis | StockMarketAgent.AI

§3 Competitive moat

Narrow

The Goldman Sachs Group Inc. possesses a Narrow economic moat grounded in its preeminent institutional advisory brand and global market-making scale. Deep corporate boardroom and sponsor relationships allow the firm to enter transaction discussions early and alone, generating significant cross-selling into financing and hedging mandates. Management reported an investment banking backlog at its highest level in five years and second-highest on record, underpinned by a record advisory backlog.

However, a Wide moat rating is precluded by the severe earnings cyclicality inherent in capital markets and binding regulatory constraints. Operating margins dropped to 9.91% in FY2023 before recovering to 17.47% in FY2025, demonstrating exposure to wholesale market volumes that pure-play asset managers avoid.

Economic profit

The firm's return on equity of 16.90% exceeds the cost of equity of 9.98%, generating economic profit during cyclical recoveries, but wholesale market fluctuations historically compressed operating margins to 9.91% in FY2023.^2,4

7.5/ 10

Narrow

Sources of advantage

Institutional advisory brand and deal distribution relationshipsPreeminent advisory franchise and deep sponsor relationships secure early trusted advisor access on major corporate transactions, leading directly into financing and hedging mandates, generating $41,453M in FY2025 Global Banking and Markets revenue.Wide
Global institutional market making scale and execution breadthGlobal scale across trading desks connects clients across Americas ($36,548M revenue), EMEA ($14,155M revenue), and Asia ($7,580M revenue), creating high institutional switching costs for liquidity and complex derivatives execution.Wide

Known threats to the moat
Threat	Severity	Timeline	Mitigation
Severe cyclical downturn in M&A dealmaking and corporate underwriting	high	12 to 24 months	Active hedging in fixed income and equities financing, alongside growing fee revenues in Asset and Wealth Management ($16,679M in FY2025).⁸

§5 Sensitivity

Discount rate

Terminal growth

	1.5%	2.0%	2.5%	3.0%	3.5%
8.0%	$718.21	$724.67	$732.30	$741.47	$752.69
9.0%	$681.03	$685.66	$690.99	$697.21	$704.57
10.0%	$648.11	$651.55	$655.45	$659.90	$665.04
11.0%	$618.39	$621.03	$623.97	$627.29	$631.04
12.0%	$591.20	$593.27	$595.56	$598.10	$600.94

Rows: discount rate (Ke for earnings; WACC for cash flow). Columns: terminal growth.

Duration change (years)

None of the valuation methods used to calculate Fair value relies on a separate assumption about how long the competitive advantage lasts.

Sensitivity reference

The highlighted cell is Fair value when every assumption sits at its base level ($655.45). Each row and column shows what Fair value becomes when one assumption moves.

FCF cliff

Free cash flow to the firm stays positive in the first projected year at $21.2B after modeled reinvestment of $0, with terminal value at 59.2% of enterprise value. A sudden drop in free cash flow is not projected unless capital spending relative to revenue, reinvestment, or gross margin resets materially.

§7 Earnings decision tree

Beat

Upgrade to Reduce; Do not add capital; re-examine operating expense leverage and evaluate whether advisory backlog momentum can sustain into future quarters.

Trigger: Diluted earnings per share and advisory revenues exceed consensus expectations driven by strong underwriting activity

While a cyclical beat confirms near-term investment banking strength, the shares trading at $949.49 remain far above $655.45, keeping the risk-reward profile unfavorable.

In-line

Maintain Sell; Continue trimming exposure on strength; track regulatory capital buffers and fee growth in alternative asset management.

Trigger: Quarterly results meet consensus expectations with steady underwriting and asset management fees

Meeting expectations validates the base operating forecast but does not resolve the valuation premium where $949.49 exceeds $655.45.

Miss

Maintain Sell; Accelerate reduction of holdings and re-evaluate exposure to wholesale capital markets dealers.

Trigger: Investment banking revenues contract sharply and advisory deal completions stall

Earnings falling below expectations exposes operating margin vulnerability and heightens downside risk toward the lower end of the valuation range.

Earnings quality

Earnings quality is supported by recurring fee expansion in Asset & Wealth Management and robust revenue realization in advisory services. While cash flows fluctuate with balance sheet financing and trading receivables typical of global dealer banks, underlying earnings reflect genuine operating profits rather than accounting accruals, with share repurchases providing consistent per-share accretion.

Metrics to watch into the print

Metric:
Global Advisory and Underwriting Backlog
CurrentBacklog reached five-year high underpinned by record advisory engagements across corporate clients.
Why it matters
Backlog levels indicate deal completion momentum over subsequent quarters, directly determining advisory fee revenue and operating profit.
Metric:
Alternative Assets Third-Party Capital Fundraising
CurrentGross third-party fundraising reached record levels with alternative assets under management expanding steadily.
Why it matters

§8 Financial history

Income statement — last six periods
Period	2021-12-31	2022-12-31	2023-12-31	2024-12-31	2025-12-31	Trend
Revenue	$64.99B	$68.71B	$108.42B	$126.85B	$125.10B	+17.8%
Gross profit	$58.98B	$44.65B	$45.23B	$52.16B	$59.40B	+0.2%
Operating income	$27.04B	$13.49B	$10.74B	$18.40B	$21.85B	-5.2%
Net income	$21.64B	$11.26B	$8.52B	$14.28B	$17.18B	-5.6%
EPS (diluted)	$59.45	$30.06	$22.87	$40.54	$51.32	-3.6%
EBITDA	$29.06B	$15.94B	$15.60B	$20.79B	$24.03B	-4.6%
R&D	—	—	—	—	—	—
SG&A	$17.72B	$15.15B	$15.50B	$16.71B	$18.91B	+1.6%

Accepted annual forecast
Metric	FY2026	FY2027	FY2028	FY2029	FY2030
Revenue	$154.90B

Cash flow

Reported operating cash flow was negative $45,154M in FY2025 and free cash flow was negative $47,218M. For a global financial institution, GAAP operating cash flow reflects changes in trading assets, collateral, and client financing receivables rather than true economic cash drain. Physical capex was $2,064M in FY2025, well covered by net income of $17,176M.^6,7

Capital allocation

Capital allocation prioritizes client franchise deployment first, maintaining regulatory capital ratios (CET1 and SLR) above regulatory minimums. Excess capital is returned via dividends ($5,277M in FY2025) and repurchases ($12,360M in FY2025), reducing diluted average shares by 8.2% between FY2023 and FY2025.

ROIC

Operating profitability has recovered from the FY2023 trough (operating margin 9.91%) to 17.47% in FY2025, driven by operating leverage where revenues expanded ~40% against 30% compensation growth.

Return on equity of 16.90% exceeds the cost of equity of 9.98% by 6.92 percentage points, generating positive economic spread.

Wholesale banking operating leverage drives significant profit rebound

Operating income rose to $21,852M on $125,097M revenue in FY2025, as compensation growth (30%) lagged top-line growth (~40%).

Marginal revenues in advisory and market making flow rapidly to pre-tax earnings during cyclical upturns.

Latest revenue$125.1BRevenue CAGR +14.2%

Operating margin17.5%10 fiscal periods

Latest free cash flow-$47.2BFY2025

Net cash$15BFY2025

Income statement breakdownHow business scale converts into reported profit.

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Financial history data
Revenue	$125,097,000,000
Cost of revenue	$65,701,000,000
Gross profit	$59,396,000,000
Operating expenses	$37,544,000,000
Operating income	$21,852,000,000
Non-operating items and tax	-$4,676,000,000
Net income	$17,176,000,000

Balance sheet snapshotHow reported assets are held and financed at the selected period.

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Balance sheet breakdown data
Total assets	$1,809,320,000,000
Cash	$164,259,000,000
Current assets	$1,018,577,000,000
Total liabilities	$1,684,348,000,000
Current liabilities	$1,226,809,000,000
Shareholders’ equity	$124,972,000,000

Cash-flow statement breakdownHow cash moved through operating, investing, and financing activities in FY2022.

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$8.7B − $3.7BFree cash flow $5B

Cash-flow statement breakdown data
Net income	$11,261,000,000
Operating inflow	$17,799,000,000
Depreciation and amortization	$2,455,000,000
Stock-based compensation	$4,083,000,000
Operating cash flow	$8,708,000,000
Operating outflow	$9,091,000,000
Cash available	$329,346,000,000
Beginning cash	$261,036,000,000
Financing inflow	$59,602,000,000
Investing outflow	$75,960,000,000
Capex	$3,748,000,000
Other investing activities	$72,212,000,000
Exchange-rate effect	$11,561,000,000
Ending cash	$241,825,000,000
Investing cash flow	-$75,960,000,000
Financing cash flow	$59,602,000,000

Revenue by operating segmentShare of total revenue for 2025-12-31.

Revenue by operating segmentShare

Global Banking And Markets$41.5B71.1%+18.2% YoY

Asset And Wealth Management$16.7B28.6%+2.2% YoY

Platform Solutions$151M0.3%−92.9% YoY

Source: SEC EDGAR · Filed 2026-02-25 · SEC EDGAR

Revenue composition data: Revenue by operating segment
Revenue by operating segment	Revenue	Share	YoY
Global Banking And Markets	$41.5B	71.1%	18.2%
Asset And Wealth Management	$16.7B	28.6%	2.2%
Platform Solutions	$151M	0.3%	-92.9%

Revenue by geographyShare of total revenue for 2025-12-31.

Revenue by geographyShare

Americas$36.5B62.7%+6.1% YoY

EMEA$14.2B24.3%+15.6% YoY

Asia$7.6B13%+11.2% YoY

Source: SEC EDGAR · Filed 2026-02-25 · SEC EDGAR

Revenue composition data: Revenue by geography
Revenue by geography	Revenue	Share	YoY
Americas	$36.5B	62.7%	6.1%
EMEA	$14.2B	24.3%	15.6%
Asia	$7.6B	13%	11.2%

Revenue and earningsHow business scale converts into reported profit.

Cash and debtLiquidity available against total borrowing.

Cash generationOperating cash flow compared with free cash flow.

ProfitabilityGross, operating, and net margin progression.

Point-in-time financial data used in the 2026-09-23 analysis.

Financial history data
Period	Revenue	EBITDA	Net income	Operating cash flow	Free cash flow	Capex	Depreciation and amortization	Stock-based compensation	Share repurchases	Dividends paid	Net debt issuance	Investing cash flow	Financing cash flow	Beginning cash	Ending cash	Cash and investments	Total debt	Operating margin	ROIC	WACC	ROIC − WACC spread
2016-12-31	$37.9B	$11.3B	$7.4B	$6.5B	$3.6B	$2.9B	$998M	$2.1B	$6.1B	$1.7B	—	$9.7B	$12.1B	—	$121.7B	$238.6B	$322.3B	27.2%	—	6.4%	—
2017-12-31	$42.8B	$12.3B	$4.3B	-$20.5B	-$23.7B	$3.2B	$1.2B	$1.8B	$6.8B	$1.8B	—	-$26.4B	$35.2B	$121.7B	$110.1B	$230.9B	$374.1B	26.0%	—	5.1%	—
2018-12-31	$52.4B	$13.8B	$10.5B	$16.6B	$8.6B	$8B	$1.3B	$1.8B	$3.3B	$1.8B	—	-$18.8B	$22.8B	$110.1B	$130.5B	$405.1B	$265.1B	23.8%	—	10.5%	—
2019-12-31	$53.9B	$12.3B	$8.5B	$23.9B	$15.4B	$8.4B	$1.7B	$2B	$5.3B	$2.1B	—	-$24.2B	$3.4B	$130.5B	$133.5B	$197.5B	$363.9B	19.6%	—	10.3%	—
2020-12-31	$53.5B	$14.4B	$9.5B	-$18.5B	-$24.8B	$6.3B	$1.9B	$1.9B	$1.9B	$2.3B	—	-$34.4B	$70.4B	$133.5B	$155.8B	$156.4B	$420.2B	23.3%	—	5.4%	—
2021-12-31	$65B	$29.1B	$21.6B	$6.3B	$1.6B	$4.7B	$2B	$2.3B	$5.2B	$2.7B	—	-$30.5B	$134.7B	$155.8B	$261B	$778.7B	$487.8B	41.6%	—	2.9%	—
2022-12-31	$68.7B	$15.9B	$11.3B	$8.7B	$5B	$3.7B	$2.5B	$4.1B	$3.5B	$3.7B	$38.1B	-$76B	$59.6B	$261B	$241.8B	$722B	$434.5B	19.6%	—	12.3%	—
2023-12-31	$108.4B	$15.6B	$8.5B	-$12.6B	-$14.9B	$2.3B	$4.9B	$2.1B	$5.8B	$4.2B	-$4.7B	-$17.3B	$27.8B	$241.8B	$241.6B	$924.9B	$583.1B	9.9%	—	13.7%	—
2024-12-31	$126.9B	$20.8B	$14.3B	-$13.2B	-$15.3B	$2.1B	$2.4B	$2.7B	$8B	$4.5B	$10.6B	-$49.6B	$7.3B	$241.6B	$182.1B	$921.8B	$616.9B	14.5%	—	12.0%	—
2025-12-31	$125.1B	$24B	$17.2B	-$45.2B	-$47.2B	$2.1B	$2.2B	$3.4B	$12.4B	$5.3B	$19B	-$44.2B	$66.1B	$182.1B	$164.3B	$624.5B	$609.5B	17.5%	—	11.5%	—

§9 Peer valuation comparison

The Goldman Sachs Group, Inc.GS

Price / fair value

Fair value$655.45Report-date price$949.49

AssessedSep 23, 2026

Economic moatNarrow

Investment scorecard57 / 100

Morgan StanleyMS

Price / fair value

Fair value$119.68Report-date price$206.12

AssessedSep 22, 2026

Economic moatNarrow

Investment scorecard

Robinhood Markets, Inc.HOOD

Price / fair value

Fair value$27.39Report-date price$75.41

AssessedMay 20, 2026

Economic moatnarrow

Investment scorecard

The Goldman Sachs Group, Inc.GS

Price / fair value

Fair value$655.45Report-date price$949.49

AssessedSep 23, 2026

Economic moatNarrow

Investment scorecard

Peer multiples and profitability
Ticker	Name	Mcap	P/E	P/S	EV/EBITDA

The Goldman Sachs Group Inc. (GS) trades at 12.7x forward earnings against a peer median of 15.6x. The comparison uses 4 peers: Morgan Stanley, Robinhood Markets, Inc., The Charles Schwab Corporation and BlackRock Inc., as of 2026-09-23.

§10 Industry & cycle

Cycle phase

Expansion

Industry capital intensity shows capex to revenue of 1.6% and capex to depreciation of 1.7x, while the firm's FY2025 capex of $2,064M sits slightly below depreciation of $2,182M.⁷

Bull cycle

An accelerating global corporate transaction cycle driven by private equity sponsor monetization, debt refinancing, and corporate restructuring elevates M&A advisory fees, while market volatility spurs institutional hedging and trading volumes across fixed income and equities.

Bear cycle

Higher-for-longer interest rates, geopolitical instability, or regulatory friction stall debt and equity underwriting, while risk-off markets compress client trading activity and trigger valuation markdowns across alternative investment portfolios.

Secular trends
Trend	Impact	Note
Private credit expansion and alternative asset institutionalization	positive	Rapid institutional demand for private credit and infrastructure investments enables third-party asset fundraising ($85B in 1H2026) without consuming bank regulatory balance sheet equity.
Basel III Endgame and tightening global capital requirements	negative	Escalating risk-weighted asset requirements and supplementary leverage ratio (SLR) rules constrain wholesale banks' capacity to deploy balance sheet for trading and financing.
AI infrastructure financing and corporate energy transition	positive	Multi-year capital expenditure programs in artificial intelligence infrastructure and energy require complex syndicated debt packages, project finance, and advisory services.

Positioning

The firm occupies a tier-one position in global dealmaking with an advisory backlog at a five-year high, while strategically shifting origination into Asset & Wealth Management ($16,679M FY2025 revenue) to mitigate regulatory balance sheet constraints.^5,8

§11 Position management

Sizing

With the shares trading at $949.49 against a Fair value midpoint of $655.45, an underweight or zero allocation is warranted under our Sell rating.⁴

Risk

Risk management focuses on protecting capital against valuation compression in an environment where market pricing assumes sustained cyclical expansion. Investors should monitor credit spreads, leverage ratio constraints, and underwriting pipeline conversion.

Entry tranches
Level	Action	Why
$655.45 (Fair value midpoint)	Re-evaluate valuation support	A pullback to Fair value of $655.45 would eliminate the market premium and restore risk-reward neutrality.
$556.62 (Bear model reference)	Consider initiating disciplined long positions	A decline toward the lower valuation boundary would provide an adequate margin of safety to absorb wholesale banking volatility.

Exit tranches
Level	Action
$950.00 - $1,000.00	Trim remaining long exposure
$1,050.00	Fully exit position

Quarterly checkpoints
Metric	Threshold	Action
advisory_and_underwriting_revenue	< $7,500M quarterly	Maintain aggressive underweight stance as cyclical fee recovery stalls.⁸
cet1_capital_ratio	< 13.00%

GS	The Goldman Sachs Group Inc.	$279.3B	12.7x	4.1x		16.9%	—
MS	Morgan Stanley	$314.4B	14.7x	4.0x		18.0%	41.6%
HOOD	Robinhood Markets, Inc.	$111.7B	36.7x	22.7x		23.6%	43.9%
SCHW	The Charles Schwab Corporation	$173.5B	12.8x	6.7x		20.3%	52.3%
BLK	BlackRock Inc.	$173.3B	16.6x	6.3x	15.6x	12.3%	35.1%

Is The Goldman Sachs Group, Inc. overvalued?

What is GS's fair value?

Should I buy GS now?

What are the biggest risks for GS?

What is GS's rating?

What archetype is GS?

The Goldman Sachs Group, Inc.

Names readers of GS also follow

Company overview

operating_margin

diluted_eps_fy2026

Narrow

Sources of advantage

Lenses that set Fair value

Forward Earnings

Global Advisory and Underwriting Backlog

Alternative Assets Third-Party Capital Fundraising

Sources

balance_sheet_constraint_cet1

wealth_management_growth

cost_of_equity

Dividend Discount Model

Checks and reference points

Reverse DCF

Common Equity Tier One and Supplementary Leverage Ratios

Revenue Growth Relative to Compensation Expense Growth

Asia Regional Revenue and Market Share