Goldman Sachs Bank Stocks: Top 5 Stock Picks

1. JPMorgan Chase & Co. (NYSE:JPM)

Goldman Sachs’ Stake Value: $2,365,161,089

Number of Hedge Fund Holders: 112

JPMorgan Chase & Co. (NYSE:JPM) is the biggest bank stock in the Goldman Sachs portfolio. Goldman Sachs, as of the first quarter of 2023, owned 18.15 million shares of JPMorgan Chase & Co. (NYSE:JPM) worth $2.3 billion, representing 0.5% of the total holdings. 

On July 14, JPMorgan Chase & Co. (NYSE:JPM) reported a Q2 non-GAAP EPS of $4.37 and a revenue of $41.3 billion, outperforming Wall Street estimates by $0.61 and $2.45 billion, respectively. 

According to Insider Monkey’s Q1 data, 112 hedge funds were long JPMorgan Chase & Co. (NYSE:JPM), compared to 100 funds in the last quarter. Ken Griffin’s Citadel Investment Group is a prominent stakeholder of the company, with 5.3 million shares worth nearly $697 million. 

Manole Capital Management made the following comment about JPMorgan Chase & Co. (NYSE:JPM) in its second quarter 2023 investor letter:

“It will be interesting to see what kind of policy decisions are made around regulation for institutions that are between $100 billion of assets and $700 billion of assets. As JPMorgan Chase & Co. (NYSE:JPM)’s purchase of First Republic shows, scale is a competitive advantage. It now has 13% of total US deposits and it manages 21% of America’s credit card spending. With additional regulatory burdens coming, banks are facing a profitability headwind and 100 to 300 basis points of possible ROE erosion.

The banking sector is facing a slow-moving crisis, but we aren’t sure it is enough to sink the overall health of the US consumer or economy. Credit will contract and lending standards will continue to rise. However, we do not see this problem escalating to the size and scale of previous banking crises.

Jamie Dimon, Chairman and CEO of JP Morgan Chase clearly sees the risks these FINTECH companies present. In his annual letter to shareholders, he stated that all incumbent banks should be “scared shitless” of these FINTECH rivals. Not only is his bank being attacked from multiple angles, but Apple just launched a cash management program with Goldman Sachs. On the first day of Apple’s savings program, it raised $400 million and eclipsed $1 billion in its first four days. Dimon specifically labeled Apple a bank the other day in an interview when he said, “It may not have insured deposits, but it’s a bank. If you move money, hold money, manage money, lend money — that’s a bank.”

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