Inflation has hit everyone hard, and don't even the most powerful financial firm is safe. Goldman Sachs released their financial forecast for the next year, and it's not optimistic.
Investing consultant @finimize posted a TikTok breaking down the forecast and explaining what it means for the company and what it says about the country's financial climate.
Goldman Sachs reported that they slashed their earnings forecast for the S&P 500 to 0% for 2023. This means they're expecting to not grow their earnings next year, which is uncommon for a company that size. They also believe that earnings per share could fall by 11%, just below the median decline of 13%.
The culprit behind this decline: Inflation. Goldman Sachs believes inflation is going to continue into next year and will increase the cost of firms in S&P 500. Because of this, the company believes it will make lower profits. In turn, investors will pay less for the stock.
This report comes despite the fact that U.S. inflation has cooled more than expected since October.
TikTok users in the comments section expressed their concern that Goldman Sachs put out this information to benefit themselves. "They'll put this out and be buying in the background," @ghjedn said. "They tell people one thing and do another. I will watch the moves they make, but not their press releases," @johnwong61 said.
That's sound advice when it comes to any multi-million dollar company. Watch them closely in the coming months before making decisions about investments.