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Feb 7 (Reuters) - Punk Ziegel analyst Richard Bove said Goldman Sachs Group Inc’s (GS.N) first quarter is not expected to be a good one and cut his fiscal 2008 earnings estimate on the company to $18.62 per share from $21.79.
Although weakness in the equity markets is impacting investment banking activities and some trading businesses, Bove said he would much rather hold this issue than sell it.
“...the company will be beset by asset value issues but its core businesses remain in good shape,” Bove added.
Third party sources, such as the Federal Reserve Board statistics, suggest that many of the markets that have been closed are opening again, and that Goldman’s business in many sectors continue to be robust, Bove said.
Bove, who has a “market perform” rating on the stock, wrote in a note to clients, “...for the first time in two years, I now believe that Goldman Sachs’ book value is understated not overstated as I have argued in the past.”
The analyst cut his 2009 earnings view on the company to $22.30 a share from $22.61. He has a price target of $200 on Goldman’s stock.
Shares of the world’s largest securities firm were trading at $186.54, down 63 cents, in morning trade on the New York Stock Exchange. (Reporting by Neha Singh and Ramya Dilip in Bangalore; Editing by Himani Sarkar)