5 big earnings reports: Goldman Sachs thrashed on weak numbers

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By Davit Kirakosyan

Investing.com -- Among 5 of the biggest earnings reports yesterday and this morning, Goldman Sachs shares slumped on earnings that widely missed expectations. Get this news first by signing up for InvestingPro.

Goldman falls short

Goldman Sachs (NYSE:GS) shares plunged more than 6% Tuesday after the bank announced disappointing Q4 revenue and earnings numbers and reported higher costs and a rising provision for credit losses.

Q4 EPS came in at $3.32, worse than the consensus estimate of $5.56. Revenue fell 16% year-over-year to $10.59 billion, missing the estimate of $10.79B, as its fees from asset and wealth management fell 27%. The bank's dealmakers and bond and currency traders both generated slightly more revenue than expected, but equities sales and trading fell short of consensus.

Morgan Stanley and United fly high

Morgan Stanley (NYSE:MS) shares surged close to 6% yesterday following better-than-expected Q4 results. EPS came in at $1.31, compared with the consensus estimate of $1.29. Revenue was $12.7B, beating the consensus estimate of $12.54B, as higher borrowing costs helped weather a slump in dealmaking that weighed on equity trading.

"Wealth Management provided stability with record revenues and over $310 billion in net new assets, Investment Management benefited from diversification, and within Institutional Securities our Equity and Fixed Income revenues were strong, offset by Investment Banking," said CEO James Gorman.

United Airlines (NASDAQ:UAL) shares were trading more than 2% higher pre-market Wednesday after the company reported strong Q4 results and said it expects to quadruple profit in 2023. Q4 EPS came in at $2.46, better than the consensus estimate of $2.11. Revenue was $12.4B, beating the consensus estimate of $12.23B.

Management expects Q1 EPS to be in the range of $0.50-1.00, compared with the consensus estimate of $0.25, with the total revenue expected to grow approximately 50% year-over-year. For the full year, management sees EPS in the range of $10-12, well above the consensus estimate of $6.54, and revenue growth in the high teens.

Rounding out yesterday's big releases

The Travelers Companies, Inc. (NYSE:TRV) shares closed more than 4% lower after the company announced its preliminary results for Q4. expecting net income of $819M, or $3.44 per diluted share, and core income of $810M, or $3.40 per diluted share. The results include the estimate for catastrophe losses of $459M pre-tax ($362M after-tax), net of reinsurance, which primarily resulted from the significant winter storm that impacted much of the U.S. and Canada in late December.

Roblox (NYSE:RBLX) shares gained more than 11% after the company presented strong key metrics for the month of December 2022, with the number of daily active users (DAUs) coming in at 61.5M, representing an 18% year-over-year growth. Hours engaged increased 21% year-over-year to 4.7B. As a result, estimated revenue was in the range of $189-199M (down 1-6%), and estimated bookings were between $430-439M (up 17-20%).

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