The financial news website The Verge is running a story about Goldman’s earnings report today, which is based on its proprietary stock price model.
That model is the same model that Goldman Sachs used to produce its earnings call yesterday.
And that model is actually pretty good, according to Goldman’s chief financial officer.
“We believe the current model is reasonably strong, which means we believe our model will be strong enough to help our clients achieve profitability,” wrote John P. Murphy, the head of Goldman’s global finance and strategy group, in a letter to analysts.
“In short, we believe that our current model will deliver strong performance for our clients.”
The news outlet has not been able to confirm the exact earnings numbers that Goldman has released, but Bloomberg estimates that Goldman is expected to report a profit of $5.1 billion on revenue of $17.4 billion in Q1.
The firm says that its average revenue growth rate is 2.7%, which is well above Wall Street’s average of just 1.3%.
But Murphy did admit that Goldman’s growth rate “may not be as good as some other firms.”
“In terms of the performance of our model, we expect our revenue growth to be higher than other firms,” Murphy wrote.
“That said, we will continue to monitor our performance.”
Goldman’s revenue was $2.9 trillion in the quarter, and its stock price is up 5.2% so far in 2018.
But Murphy also wrote that Goldman had been “somewhat cautious” with its valuation of its business.
“While our valuation metrics may be somewhat conservative, we are mindful of our potential to achieve greater return in the future,” Murphy said.
Goldman’s profit growth rate may not be the highest among financial firms, but it is still a good one, and it’s better than many of the companies that Wall Street is looking at right now.
Wall Street, for example, is looking to its hedge fund clients to outperform Wall Street as the stock market falls.
In the end, however, Goldman’s model is not the most efficient way to make money.