Magazine article American Banker

Goldman, Lehman, Morgan Lifted by Merrill Analyst

Magazine article American Banker

Goldman, Lehman, Morgan Lifted by Merrill Analyst

Article excerpt

Merrill Lynch analyst Judah S. Kraushaar on Tuesday lifted its earnings projections for Goldman Sachs Group Inc., Lehman Brothers Holdings Inc., and Morgan Stanley Dean Witter & Co., saying their revenues have not suffered as much this quarter as he had feared.

Mr. Kraushaar raised his third-quarter estimate for Goldman Sachs to $1.51 per share, from $1.29, and the 2000 estimate to $6.30, from $5.90. He lifted his quarterly estimate for Morgan Stanley to $1.51, from $1.20, and for the year to $5.35, from $5.05. He lifted Lehman to $2.51 for the quarter, from $ 2.16, and to $11.50 from $10.80 for the year.

Mr. Kraushaar noted that his estimates are still 3% to 7% below consensus, so the stocks "could produce visible earnings disappointment" when the companies report third-quarter results.

Investment banks lost ground in Tuesday's trading. After rallying for weeks, Goldman Sachs slipped $2.5625, or 2.12%, to $118.1875, Morgan Stanley $2.5625, or 2.46%, to $101.50, and Lehman closed at $ 130.75, down $ 6.625, or 4.82%.

Lauren A. Smith, an analyst at Keefe, Bruyette & Woods who covers all three brokers, downplayed the declines Tuesday, saying she is still positive on the stocks.

Commercial banks lost value too, as the American Banker index of 225 banks dropped 1.18% and its index of the top 50 fell 0.91%.

Also on Tuesday, Donaldson, Lufkin & Jenrette increased its 2001 estimate for MBNA Corp. to $1.88 from $1.83 and its price target for the company's shares to $42, from $37, citing MBNA's acquisition of First Union's $5. …

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