Citigroup Reiterates Buy Rating On GS

Goldman Sachs Group, Inc. GS sold-off ~5% today after reporting a modest EPS miss ($3.79 vs. Citi $3.85 est and consensus of $3.76) w/ expectations likely higher given JPM's recent results, Citigroup reports. “Versus our estimates the miss was driven by FICC and equities, offset by gains in equity investments and a lower-than-expected comp accrual,” Citigroup writes. “Normalizing for comp, UK bonus tax reversal, and some specials, we peg 4Q10 adj ROTE of ~11% vs 14% reported, and well below Goldman's long-term potential of about 16%. “Trading at just 1.25x our 4Q11 est TBV, we see GS as among the best buying opportunities in our universe especially as expectations get reset lower after a tough 4Q and we strongly reiterate our Buy rating at these levels. “Longer term, we see GS as well positioned to retain and gain market share given its technology advantages, ongoing investments in emerging markets, with earnings highly levered to an improving global economic recovery.” Goldman Sachs Group closed Wednesday at $166.49.