JPMorgan: Goldman, Morgan Stanley Set for IPO Trading Boost
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- JPMorgan analysts recommended buying Goldman Sachs and Morgan Stanley as a short-term trade, temporarily upgrading both to "outperform" ahead of Q2 results due July 15 (GS) and July 16 (MS), while keeping the official rating at neutral.
- JPMorgan raised its 2026 adjusted EPS forecasts for Goldman by 5% and Morgan Stanley by 2%, bumping price targets to $900 (from $826) and $187 (from $179), even though Goldman already closed Thursday at $1,037 and Morgan Stanley at $213.
- Goldman and Morgan Stanley are lead advisors on the SpaceX IPO, and JPMorgan's Rob Dwyer and Ayano Tsunoda say a wave of giant listings is producing a "multiplier effect" into secondary trading and financing that is "likely underestimated by the market."
- Equity trading revenue is forecast to climb 21% year-over-year in Q2, with FICC up 7% and total market revenues up 14%, building on what was the best first quarter ever for investment-bank equity sales and trading.
- Persian Gulf hostilities have driven sharp commodity-market turbulence and a surge in hedging activity, an area where both Morgan Stanley and Goldman Sachs are "extremely active."
- U.S. investment banks trade on P/E multiples in the upper teens versus mid-single digits for European peers Barclays and Deutsche Bank, but JPMorgan argues the U.S. names offer superior earnings momentum from booming exchange volumes and expanding balance sheets.
Why it matters: Goldman and Morgan Stanley shareholders now have a two-week window to position for Q2 prints, and JPMorgan is betting the IPO-and-trading flywheel — anchored by SpaceX — produces upside the consensus isn't pricing in; with both stocks already trading well above JPMorgan's raised targets, the call effectively requires an earnings beat rather than a rerating to pay off.
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