Bloomberg Anywhere Remote Login Bloomberg Terminal Demo Request


Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.


Financial Products

Enterprise Products


Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000


Industry Products

Media Services

Follow Us

Markets & Finance

Goldman Cuts Top Brokers Estimates

Goldman Sachs cut the Q3 EPS estimates on Charles Schwab (SCH) Morgan Stanley Dean Witter (MWD) and Lehman Brothers (LEH).

Analyst Richard Strauss says brokerage fundamentals remain in the doldrums but valuations are improving. Stocks are now 35% off their highs, and last time the group was cheaper occurred when it dipped below two times the book value, hitting 1.8 times the book price during the severe emerging markets crisis in the fall of 1998.

Still, Strauss says he'd only nibble at these levels as there is still no change in fundamentals. He lowered his $0.08 Q3 EPS estimate for Schwab to $0.07, cut the $0.70 Morgan Stanley estimate to $0.60, and trimmed the $1.15 Lehman to $1.05.

Strauss says the industry is trading at a "reasonable" 12.4 times 2002's EPS, however, whether the earnings of the three brokers can rebound by 30% next year is mostly guesswork.

blog comments powered by Disqus