"Nearly Perfect" Q1 Performance Reignites Optimism, Goldman Sachs Stock Hits New High for 2021

According to the Zhitong Finance and Economics APP, the stock price of Goldman Sachs Group (GS.US) rose to a record high on Tuesday, surpassing the closing high set over two years ago.

The investment banking giant released its first-quarter financial report last week, with profits significantly exceeding expectations, described by an analyst as "almost perfect performance." Optimism about the revival of trading has driven the stock to consecutive gains this year, breaking the previous high set in November 2021 when Goldman Sachs achieved a record annual profit.

By the Tuesday close, Goldman Sachs stock rose by 1.59% to $424.00, reaching a new closing high for the company that has a 155-year history since its listing 25 years ago.

Under the leadership of CEO David Solomon, Goldman Sachs is repositioning itself to achieve its goal of being "cleaner and simpler." In the previous year, Goldman Sachs faced criticism due to sluggish trading, with losses in the real estate business eroding profits and a reduction in consumer banking operations.

After focusing on dissolving the retail division, the losses from that segment had little impact on this quarter's earnings. Subsequently, Goldman Sachs began to demonstrate its trading strength, seizing market share from competitors and reaffirming its dominant position in the trading field.

Goldman Sachs' first-quarter financial report shows a 16% year-on-year increase in revenue and a 28% year-on-year increase in net profit, both exceeding expectations. Investment banking and trading businesses, fixed income, currencies and commodities (FICC) trading, as well as merger advisory fees, stock and debt underwriting, all performed better than expected.

Analyst Chris Kotowski from Oppenheimer described it as an "almost perfect report." He stated, "Performance in almost all categories of income and expenses significantly exceeded expectations."

HSBC analyst Saul Martinez mentioned in an interview that the market is accepting, or rather liking, the information indicating the return of areas where Goldman Sachs excels. With the prospect of further improvement in the "investment banking business background," Goldman Sachs' profitability and profit margins may see strong growth.

It is worth noting that this year, due to less severe regulatory plans than initially expected, as well as optimism about a soft landing of the U.S. economy and the reopening of capital markets, the stocks of the largest U.S. banks have risen, outperforming regional peers. JPMorgan Chase also hit a historical high in January this year.

Nearly 25 years ago, in May 1999, Goldman Sachs went public for the first time at a price of $53 per share, attracting significant attention. Since then, the stock price of this Wall Street giant has multiplied eightfold