Goldman Sachs vs Wells Fargo & Which Should You Buy?

Goldman Sachs and Wells Fargo are two of the largest and most well-known financial institutions in the United States. Both companies offer a wide range of financial services, including investment banking, wealth management, and retail banking. When it comes to their performance in the stock market, both Goldman Sachs and Wells Fargo have seen fluctuations in their stock prices over the years. Investors often compare the two companies' stocks to determine which may be a better investment opportunity.

Goldman Sachs or Wells Fargo &?

When comparing Goldman Sachs and Wells Fargo &, 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 Goldman Sachs and Wells Fargo &.

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. Goldman Sachs has a dividend yield of 1.94%, while Wells Fargo & has a dividend yield of 2.12%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Goldman Sachs reports a 5-year dividend growth of 27.23% year and a payout ratio of 36.22%. On the other hand, Wells Fargo & reports a 5-year dividend growth of -4.54% year and a payout ratio of 34.33%.

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 Goldman Sachs P/E ratio at 15.79 and Wells Fargo &'s P/E ratio at 13.25. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Goldman Sachs P/B ratio is 1.59 while Wells Fargo &'s P/B ratio is 1.31.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Goldman Sachs has seen a 5-year revenue growth of 0.57%, while Wells Fargo &'s is 0.16%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Goldman Sachs's ROE at 10.23% and Wells Fargo &'s ROE at 9.96%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $588.61 for Goldman Sachs and $70.79 for Wells Fargo &. Over the past year, Goldman Sachs's prices ranged from $365.00 to $612.73, with a yearly change of 67.87%. Wells Fargo &'s prices fluctuated between $46.12 and $78.13, with a yearly change of 69.41%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.