Goldman Sachs' Funding Moves Meet Pullback as Fair Value Still in View

Goldman Sachs Group (GS) has been active in its funding arm, issuing fixed-rate callable notes across maturities from 2028 to 2046. This move is part of a broader effort by the firm to adjust its funding structure. However, recent trading activity has cooled, with Goldman Sachs' share price declining 8.64% over the past 30 days and 11.83% over 90 days.

Despite this short-term pullback, analysts believe that the long-term momentum remains intact, as evidenced by a 20.07% 1-year total shareholder return and a very large 3-year total shareholder return. The question now is whether the recent dip reflects fair value or if investors should wait for a cheaper entry point.

According to Goldman Sachs' last close price of $949.49, the most widely followed narrative suggests that the firm is currently undervalued by 17%. This valuation estimate puts the firm's fair value at $1,141.65. The investment thesis is supported by firmwide technology and AI investments, which are expected to increase productivity and potentially improve net margins and earnings power.