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Goldman Sees Record U.S. Corporate Cash Spending Cuts This Year

  • Cash acquisition spending to fall by about half, Kostin says
  • Most investors already looking to 2021 EPS, strategist says
Treasury Secretary Mnuchin Views Production Of Currency Bearing His Signature
Photographer: Andrew Harrer/Bloomberg

The biggest U.S. companies will slash their cash spending this year amid the uncertainty of the coronavirus pandemic, according to Goldman Sachs Group Inc.

“We forecast S&P 500 cash spending will decline by an annual record 33% during 2020 as firms prioritize liquidity in a worsening economic environment,” strategists led by David Kostin wrote in a note Friday. He continues to expect a big decline in earnings per share for the first and second quarters. He noted that “most investors are already looking ahead to 2021 EPS.”