BlackRock vs Goldman Sachs Which Is Superior?

BlackRock and Goldman Sachs are two of the largest and most prestigious investment banks in the world. Both companies have a long history of success in the financial industry, but they have different approaches to investing. BlackRock is known for its focus on passive index funds and risk management, while Goldman Sachs is known for its expertise in trading and investment banking. Investors often compare the two companies' stocks to determine which provides the best return on investment.

BlackRock or Goldman Sachs?

When comparing BlackRock and Goldman Sachs, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between BlackRock and Goldman Sachs.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. BlackRock has a dividend yield of 2.43%, while Goldman Sachs has a dividend yield of 1.9%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. BlackRock reports a 5-year dividend growth of 10.72% year and a payout ratio of 50.12%. On the other hand, Goldman Sachs reports a 5-year dividend growth of 27.23% year and a payout ratio of 36.22%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with BlackRock P/E ratio at 25.52 and Goldman Sachs's P/E ratio at 15.84. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. BlackRock P/B ratio is 3.87 while Goldman Sachs's P/B ratio is 1.59.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, BlackRock has seen a 5-year revenue growth of 0.36%, while Goldman Sachs's is 0.53%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with BlackRock's ROE at 15.40% and Goldman Sachs's ROE at 10.23%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $1038.49 for BlackRock and $587.09 for Goldman Sachs. Over the past year, BlackRock's prices ranged from $712.11 to $1068.34, with a yearly change of 50.02%. Goldman Sachs's prices fluctuated between $334.55 and $607.15, with a yearly change of 81.48%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.