The market received fourth-quarter results from many of the major U.S. banks on Wednesday, including reports from investment firms Goldman Sachs GS and BlackRock BLK.

As two of the renowned global leaders in asset management, let’s see if it’s time to buy stock in either of these New York-based finance giants.

Goldman's Massive EPS Suprise 

Goldman Sachs stole the show in yesterday’s busy earnings lineup which also included Q4 reports from three of the four major big banks, Wells Fargo WFC, Citigroup C, and JPMorgan JPM.

Taking the spotlight, Goldman reported a massive EPS surprise of 48% with Q4 earnings at $4.11 billion or $11.95 per share compared to expectations of $8.07. This came on quarterly sales of $13.86 billion which was 13% above estimates of $12.26 billion.

Goldman attributed its stellar Q4 results to an improved operating backdrop with Q4 earnings doubling from the comparative quarter while sales increased 22% from $11.31 billion a year ago.

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BlackRock Reaches Record AUM

BlackRock didn’t blow away its Q4 expectations but was able to flex its robust financial figures as well. Q4 EPS was at $11.93 compared to expectations of $11.27 with sales of $5.67 billion coming in 2% better than expected.

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Year over year, BlackRock’s Q4 earnings and sales spiked over 20% respectively as the company highlighted that its assets under management (AUM) hit a record $11.6 trillion thanks to quarterly net inflows of $281 billion.

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Full-Year Comparison

While BlackRock remains the world’s largest money manager, Goldman ended 2024 as the global leader in announced and completed mergers and acquisitions (M&A).

Overall, Goldman’s total sales spiked 16% in fiscal 2024 to $53.51 billion compared to $46.25 billion in 2023. More impressive, annual earnings soared over 70% to $14.28 billion or $40.54 per share versus EPS of $22.87 in 2023. Notably, this was the second-highest mark on Goldman’s top and bottom lines with its incorporation dating back to 1867.

As for BlackRock, total sales of $20.41 billion increased 14% with annual earnings rising over 15% to $6.37 billion or $43.61 per share. It’s also noteworthy that BlackRock reported record annual net inflows of $641 billion in addition to its peak in AUM. 

Performance & Valuation Comparison

Over the last year, Goldman’s stock has risen +62% to impressively top BlackRock and the benchmark S&P 500’s gains of +26%. In the last five years, GS is up +145% to also top BLK and the broader market’s gains of over +80%.

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At their current levels, GS trades at 13.9X forward earnings and at a pleasant discount to BLK which trades roughly on par with the benchmark at 21.2X  

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Bottom Line

Attributed to its "cheaper" P/E valuation and the fact that earnings estimate revisions are likely to rise after a massive Q4 EPS surprise, Goldman Sachs stock sports a Zacks Rank #2 (Buy) with BlackRock landing a Zacks Rank #3 (Hold).

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The Goldman Sachs Group, Inc. (GS) : Free Stock Analysis Report

BlackRock (BLK) : Free Stock Analysis Report

Wells Fargo & Company (WFC) : Free Stock Analysis Report

JPMorgan Chase & Co. (JPM) : Free Stock Analysis Report

$Citigroup Inc(C-N)$. (C) : Free Stock Analysis Report

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