(Reuters) - Goldman Sachs Group Inc (GS.N) may reward long-term investors as demand for the U.S. investment bank’s worldwide underwriting, trading and custodial services grows with the global economy, according to Barron‘s.
In an article for release on Monday, Barron’s said Goldman’s shares were recently hurt by news New York Attorney General Eric Schneiderman was investigating Goldman’s high-frequency trading operations and the U.S. Securities and Exchange Commission was looking into the hiring practices of the big banks in Asia.
But for longer-term investors, Barron’s said pricing for market-making and liquidity services offered by the bank should improve as the cost of new regulations and greater capital levels are passed through to issuers and investors.
The paper said higher costs for those services may come sooner rather than later as the industry’s weaker players, like UK bank Barclays Plc (BARC.L), leave.
“It’s a last man standing game, and Barclays blinked,” said Brad Hintz, a senior analyst at Bernstein Research, in the Barron’s article.
Hintz has a buy rating on Goldman with a $205 price target, which is 30 percent above the current stock price of $157.
Reporting by Scott DiSavino; Editing by Mark Trevelyan