​Disclaimer: Please research these stocks yourself to get a full, confident understanding before investing! These features are meant for informational purposes, and are not a promise of profit or an endorsement.

General Info

• Asset Class: Cryptocurrency
• Market Cap: $943 billion (as of 02/24/2021)
• 1 Year Return: 442.3%
• Detailed Description: Simply put, cryptocurrencies are currencies managed solely on a digital platform and are not controlled by a centralized authority. Most currencies that we use today such as the US dollar are called fiat currencies, which are government-issued currencies that are not backed by a commodity such as gold. The decentralized nature of cryptocurrencies allows for many benefits over fiat currencies such as less manipulation and the elimination of middle third parties that handle our money. This is especially relevant today, as recent events have shown us exactly how flawed our current economic system is and how the current “free market” is in reality heavily manipulated and controlled by large institutions. 
  
  In late January and early February this year, a large group of small investors on Reddit had decided to collectively buy shares of GameStop, AMC, and other failing companies to essentially force large institutions who were shorting those companies to take a heavy loss (for more information on what happened watch Andrei Jikh’s video listed below). However, trading platforms such as Robinhood and TD Ameritrade restricted investors from purchasing those stocks, essentially protecting those large institutions from losing more money. But while everyone blamed the trading platforms for siding with the large institutions, the problem wasn’t entirely the trading platforms. Instead, there were two major problems that had to do with how money is transferred and how rich institutions have too much power in our current economic system. 
  
  When money is transferred, it might seem instantaneous to the parties taking part in the transaction, but in reality there is a middle party that handles the money and makes sure both parties meet the requirements of the agreement. In the case of the stock market, trading platforms simply route users’ trades to a market maker, which is a company that actually holds the stocks. However, since money can take several days to actually transfer, there is a financial institution called a clearinghouse that facilitates the exchange of money between the trading platforms and the market makers. Clearinghouses require trading platforms to put a deposit or a collateral which has a value that is based on the volatility of the customers’ trades. In this recent case, since the volatility of GameStop, AMC, and the other stocks these customers were trying to buy was too high, the clearinghouses required ridiculously high collaterals from the trading platforms which didn’t make sense for the trading platforms to risk. 
  
  However, not only did the systemic problems of buying stocks get in the way of the Reddit group’s goal of taking down the rich institutions, the rich institutions also played a role in protecting themselves. As many might not know, some rich institutions are the market makers. Market makers gain huge profit from brokering the buying and selling of stocks and they themselves also invest in the stock market. Recently, market makers such as Citadel heavily shorted GameStop stocks, so when too many people started buying GameStop stocks, they were losing too much money and it was speculated (though later publicly refuted by the market makers) that they influenced trading platforms to restrict the trading of those stocks. Regardless of what they actually did, the fact that market makers and other large financial institutions control so much wealth and manage the purchasing and selling of stocks signals too much consolidation of power. Large institutions gathering together, discussing opinions, and making large decisions which in turn influence the price of stocks resulting in huge profit is something that has been happening since the beginning of the stock market. Now when a group of small investors do the same by discussing opinions and making decisions together, large institutions including federal institutions suddenly label these actions as price manipulation and actions that are entirely too risky for the markets. 
  
  Today, it takes less time for Amazon to deliver toothpaste than for money to fully transfer. And with large institutions controlling massive wealth, there is no free market. Cryptocurrencies solve both of these problems by eliminating the need for a middle third party by utilizing a decentralized network. In 2009, the pseudonymous creator Satoshi Nakamoto pioneered Bitcoin, which started the cryptocurrency revolution. 
  
  So how does Bitcoin work? Bitcoin is a currency that relies on a network of computers that verify transactions by solving extremely complex math problems. That might sound confusing so lets visualize:
  
  Imagine there are a group of friends that is trying to figure out how much money each person owes each other. So for example, one day Sam pays Tom 10 dollars and Bob pays Sam 5 dollars. Then the next day Tom pays Sam 5 dollars and Bob also pays Sam 5 dollars and so on. As the list of transactions gets longer, it gets harder for all the friends to keep track of who owes what. On the Bitcoin network, transactions like these are recorded on a public list or a ledger that is encrypted by a decentralized network of computers. These computers are competing to find a specific unique key to encrypt each set of new transactions (also known as a block) that is posted on the public ledger. Everyone has a digital wallet with a specific amount of Bitcoin and the network ensures the precise transfer of Bitcoin in and out of these digital wallets. The exact mechanics of how Bitcoin actually works is incredibly complex and we recommend watching the video linked below to fully understand it.
  
  While there are several different types of cryptocurrencies that operate in a similar way to Bitcoin, Bitcoin not only is the most valuable cryptocurrency, but it also has the most computing power in its network.​

Positives

• Since Bitcoin is decentralized, it is much more difficult to be manipulated and fully regulated than a typical fiat currency
• The use of the blockchain ensures that transactions on the Bitcoin network are extremely secure
• The longer Bitcoin has value and stays around the more likely it is to be adopted
  Bitcoin has been one of the best performing assets over the past ten years
• Many large companies such as Tesla and Paypal are investing in Bitcoin and converting their platforms to be compatible with Bitcoin which further supports the case that Bitcoin is here to stay
• Younger generations are more comfortable with understanding the technology behind Bitcoin and accepting it into our rapidly digitizing world
• Bitcoin is one of the most globally accessible currencies due to its decentralized nature
• Scarcity aspect of Bitcoin makes it a perfect store value asset
• Since the federal bank instituted hyperinflationary measures to keep the economy afloat during the coronavirus crisis, investors see Bitcoin as a perfect hedge against inflation due to its scarce nature
• Since Bitcoin was the first created cryptocurrency and is currently the most valuable cryptocurrency, there is the most computing power operating on its network
• So far, Bitcoin has proven to be a very reliable and secure currency
• Bitcoin eliminates the need for middle parties such as banks to handle our money which makes money flow more transparent

Negatives

• While other cryptocurrencies can transfer in seconds, Bitcoin takes minutes to transfer which makes it imperfect as a currency
• Bitcoin’s extreme volatility also makes it a difficult currency to work with
• Cryptocurrencies have only been around for a short time which means there are still several unknowns, and therefore Bitcoin and other cryptocurrencies are still highly speculative and risky
• There is still the possibility for tough local regulation on cryptocurrencies which could negatively impact the value of them
• There is also the possibility of error or the invention of supercomputing (which would essentially allow for the manipulation of cryptocurrencies) which would crush cryptocurrencies
• Increased use of Bitcoin and insufficient computing power would result in long transaction times and high fees
• Many people, especially older generations, still don’t understand it
• Using Bitcoin requires technology which makes it less accessible to everyone
• Bitcoin hasn’t been fully adopted and embraced yet which means its value is more prone to investor sentiment
• Many people argue that unlike gold and other store value assets, Bitcoin has no intrinsic value (although this is debatable)
• High learning curve to use and store Bitcoin

Outlook (Buy)

• Any investor looking to buy Bitcoin first needs to understand that they could lose their entire investment. Bitcoin and cryptocurrencies in general are still highly speculative assets, and it is extremely risky for an investor to invest more than they are willing to lose into Bitcoin. That being said, Bitcoin has been one of the best performing assets in the past ten years, and its incredible technology and economic implications really mean that Bitcoin has only two possible outcomes: it goes to zero or it goes to the moon. In a recent podcast with Bitcoin bull Anthony Pompliano, former hedge fund manager Raoul Pal said he would advise someone that has a steady income and has saved up 100,000 dollars to invest half of it into Bitcoin. If that person loses that 50,000 dollars it sucks. It feels bad, but it’s not life ending. That person would still have enough to survive. But if that 50,000 dollars turns into 500,000 or 5,000,000 dollars, it’s life changing. We highly advise investors to understand how Bitcoin works at a deeper level and its economic implications especially in today’s world, but it doesn’t hurt to allocate one percent of your portfolio to Bitcoin and join in on the cryptocurrency revolution.

Check Out:

• Andrei Jikh’s video about the GameStop saga: https://www.youtube.com/watch?v=POgO3ys1CJ0&ab_channel=AndreiJikh
• Bitcoin explained:
  https://www.youtube.com/watch?v=bBC-nXj3Ng4&ab_channel=3Blue1Brown

Written by: Grant Park

​General Info

• Sector/Industry: Consumer Defensive — Discount Stores/Retail
  
• Forward PE: 37.43 (Industry Median: 17.38)
  
• PE: 37.99 (Industry Median: 18.43)
  
• Net Profit Margins: 2.5% (Industry Median: 1.55%)
  
• Price/Book: 11.07 (Industry Median: 1.82)
  
• Return on Equity: 26.23% (Industry Median: 8.04%)
  
• Dividend Yield: 0.74 (Industry Median: 1.91)
  
• Revenue CAGR: 8.93%
  
• Income CAGR: 14.31%
  
• Currently sitting at approximately $370 share price; sits slightly below the 50 but above the 200 day moving average
  
• Basic Description: Costco Wholesale Corporation engages in the operation of membership warehouses in the United States, Puerto Rico, Canada, the United Kingdom, Mexico, Japan, Korea, Australia, Spain, France, Iceland, China, and Taiwan. It offers branded and private-label products in a range of merchandise categories. The company provides dry and packaged foods, and groceries; snack foods, candies, alcoholic and nonalcoholic beverages, and cleaning supplies; appliances, electronics, health and beauty aids, hardware, and garden and patio products; meat, bakery, and deli products, as well as produce; and apparel and small appliances. It also operates pharmacies, optical dispensing centers, food courts, and hearing-aid centers, as well as 615 gas stations; and offers business delivery, travel, same-day grocery, and various other services online in various countries. As of October 07, 2020, the company operated 796 warehouses, including 552 in the United States and Puerto Rico, 102 in Canada, 39 in Mexico, 29 in the United Kingdom, 27 in Japan, 16 in South Korea, 13 in Taiwan, 12 in Australia, 3 in Spain, 1 in Iceland, 1 in France, and 1 in China. It also operates e-commerce websites in the United States, Canada, the United Kingdom, Mexico, South Korea, Taiwan, Japan, and Australia.
  

Positives

• Unlike many other brick-and-mortar retailers, Costco specializes in offering membership for most their offered products, locking in customers 
  
• Boasts high membership retention (around 90%) and membership grows every quarter, most recently reaching more than 107 million cardholders
  
• Similarly, customers tend to stick with Costco, their reputation and brand name is valuable because of their quality offerings, generous return and cash back policies, and discount prices
  
• Opened up 8 units/warehouse stores in Q1 2021 and plans to open up 20-22 for the 2021 year
  
• Continues to build on its availability during COVID and its offerings of much of the household items needed by customers, reported 17% comparable stores growth (this means how much existing stores grew their revenue)
  
• Management employs the use of occasional special dividends paid out to shareholders (i.e. $10 per share every few years) which can be quite attractive for long term Costco investors
  
• E-commerce continues to demonstrate relatively encouraging growth, most recently posting 86% year-over-year growth in Q1 2021
  
• Recent acquisition of Innovel, a logistics company specializing in “final-mile” delivery services and handling big, bulky products, will help Costco ship faster and support sales of a larger variety of products
  
• Costco’s multitude of locations, customer service, store experience, and popularity gives it a fairly recognizable advantage ahead of its direct competitors: BJ’s Wholesale & Walmart’s Sam’s Club
  
• Variety of product and services, from the $1.50 hot dog & soda combo to the cheaper gas to its Kirkland-branded goods, Costco has pushed to involve itself in various areas
  
• In its stores, Costco’s lack of store signs forces customers to wander around more and buy more along the way
  
• Costco also employs the strategy to lower the costs of relatively popular items to get customers in the door like chicken but is able to sell everything in bulk and get customers to buy more expensive items along the way
  
• Additionally, Costco’s great treatment of employees is well-documented by pay and benefits, incentivizing excellent customer service and attracting motivated employees
  
• Costco has great growth prospects outside the US to execute upon, most recently Costco’s first store in China was met with excitement
  
• Partnership with Instacart allow for e-commerce functions to perform better
  

Negatives

• Costco’s dependence on brick-and-mortar operations to increase sales as customers walk around their store and buy random things with high margins can be challenged as e-commerce continues to dominate 
  
• Costco’s late entrance into e-commerce currently only attracts customers that are already members, they are still catching up to others (i.e. Amazon, Walmart, Target) and also don’t offer helpful services like curbside pickup because of their belief in brick and mortar 
  
• Costco’s COVID-related growth where customers tended to purchase and hoard items to a certain extent is likely not sustainable and can affect sales in certain categories
  
• Dependence on international expansion for growth will be a risky play for Costco, and it will be difficult for Costco to grow inside the US given its current dominance in its space
  
• Areas outside of Costco’s core business seem unlikely to be explored by management and interesting growth avenues are a bit difficult to imagine over the long term
  
• E-commerce makes up just 7% of Costco’s sales, the adaptability to e-commerce (if trends continue) could be concerning
  
• Fastly growing competitors such as BJ’s Wholesale present respectable challenges especially as Costco decreases its store expansion
  
• Premium wage costs paid out during COVID may stick around even after the pandemic and concerns with employees contracting COVID are worrisome
  

Outlook (Buy)

• We are bullish on Costco’s fundamental business philosophies geared towards the interests of customers and belief in its brick-and-mortar stores over the long-term. In addition, their ability to continually offer valuable products while maintaining solid profits is a testament to their business model’s unique success and place in the retail space. We don’t believe that other competitors will be able to take away significant market share in the foreseeable future and are encouraged by Costco’s potential to expand internationally. In terms of e-commerce, we believe that Costco’s rapidly increasing support for online shopping will be satisfactory for most customers but the majority of their business should and will continue to come from strong brick-and-mortar store performance. 

Check Out:

• Understand the headwinds generated by lower gas demand for Costco’s reported growth
  
• 10-K (2019) and 10-Q (Q1 2021)
  
• Most recent earnings call transcript (Q1 2021)
  
• Familiarize oneself with Costco’s competitors in Walmart-owned Sam’s Club and BJ Wholesale
  
• Analyze acquisitions and partnerships (Innovel, Instacart) and their ability to generate profit over the long-term or increase innovation within Costco’s e-commerce platform
  
• Look into COVID-related wage premiums and the effect of infection among employees
  
• Examine management and board of directors track records
  
• Map out Costco international and domestic store expansion potential and plans
  

​Disclaimer: Please research these stocks yourself to get a full, confident understanding before investing! These features are merely a recommendation, not a promise of profit or an endorsement.

​Disclaimer: Please research these stocks yourself to get a full, confident understanding before investing! These features are merely a recommendation, not a promise of profit or an endorsement.

General Info

• Sector/Industry: Communication Services — Entertainment
• Forward PE: 22.53 (Industry Median: 14.07)
• PE: 20.84 (Industry Median: 18)
• Net Profit Margins: 19.02% (Industry Median: 2.19%)
• Price/Book: 2.8 (Industry Median: 1.51)
• Return on Equity: 18.92% (Industry Median: 3.44%)
• Revenue CAGR: 7.74%
• Income CAGR: 5.59%
• Currently sitting at approximately $140 share price; sits slightly below the 50 and 200 day moving average
• Basic Description: The Walt Disney Company operates to provide worldwide entertainment with a diverse product/service line, ranging from TV (ABC, ESPN, Disney, FX, Nat Geo, etc.), Disney Parks (Disneyland, World Resort, Shanghai Disney Resort, etc.), movies/motion pictures (20th Century Fox, Marvel, Lucasfilm, Pixar, etc.), and streaming services (Disney+, Hulu, ESPN+, etc.). It truly is difficult to visualize all the various products and services that are offered by Disney, especially after Disney’s merger with Fox in early 2019.

Positives

• Recognizable brands and franchises, from the Simpsons, Marvel Superheroes, Star Wars, etc.
• Appeals directly to a constantly growing demographic of children and young adults, attaches nostalgic, pleasurable memories to characters, TV shows, movies, and experiences that can be repeatedly accessed 
• Consistent revenue stream, difficult to affect or damage over long-run
• Business beyond boundaries of Western culture, already has and can be expected to continue entering emerging markets
• Recently-released (in Nov 12, 2019) Disney+, packaged with Hulu and ESPN+, expected to have added 25-30 million subscribers
• In 2017, Disney began to transition its focus to direct-to-consumer(DTC) experiences which are different from traditional product/service offers which are usually indirectly provided through a middleman
• Experiences such as Hulu, Disney+, ESPN+ have performed extremely well
• For example, ESPN+ (UFC, NFL Primetime, College Sports, domestic/international soccer) itself has 3.5 million paid subscribers
• Acquisition of 21st Century Fox adds extremely important licensing and IP value as well as incorporation into DTC business (i.e. adding Simpsons episodes to Disney+)
• Disney+ will spread into Western Europe (UK, France, Germany, Spain, Germany) on March 31st, expected to perform well based on tests in the Netherlands
• Lion King, Toy Story 4, Aladdin drove up operating income in the past year, as long as Disney continues to push and create interesting movies with its licensed characters, will consistently do well

Negatives

• Disneyland parks and resorts, especially in China, show concern as they recently shut down due to the spread of coronavirus, directly hitting the revenue line 
• Last quarter (Q4) and next quarter have shown some instability and weakness due to natural disaster and uncontrollable events
• TV programming and advertising revenue has been slightly down, Disney notices this weakness and transitioning more to DTC business focus and approach to entertainment
• Requires constant content updates on Disney+, Hulu to keep users active and pleased, a problem similar with Netflix, can’t expect consistent users with only the Mandalorian

Outlook (Buy)

• Short-term issues with coronavirus, indices selling off shares because of these fears, buy and hold long-term, reap profits when stocks bounce back eventually
• Disney allows for long-term continuity and consistent growth
• Promising turn towards DTC business while maintaining parks and resorts along with cable networking

​Check Out:

• Annual Report (2019) and 10-Q (Q4 2019)
• Most recent earnings call transcript (Q4 2019)
• Pay attention to upcoming Disney earnings (Q1 2020)
• Familiarize oneself with DTC business, Disney’s competitors such as Netflix
• Analyze coronavirus impact on the resorts business
• Determine management competence under CEO Robert Iger
• Properly model out different potential valuations of DIS (i.e. DCF model, comps)​

General Info

• Sector/Industry: Industrials — Airlines
• Forward PE: 7.69 (Industry Median: 14.62)
• PE: 8.04 (Industry Median: 14.83)
• Net Profit Margins: 10.12% (Industry Median: 3.84%)
• Price/Book: 2.45 (Industry Median: 1.14)
• Return on Equity: 33.8% (Industry Median: 6.97%)
• Forward Dividend Yield: 2.63%
• Revenue CAGR: 2.97%
• Income CAGR: (negative)
• Currently sitting at approximately $60 share price; sits approximately at the 50 and 200 day moving average
• Basic Description: Delta Air Lines provides air transportation for passengers and cargo. 

Positives

• Relatively undervalued based on valuation metrics
• Resistant to economic fluctuations, airlines will gain a rather consistent revenue/income stream regardless of macro issues
• Delta is the highest-rated major airline (behind Jetblue, Southwest, and Alaska) due to its amenities and services
• Delta has become the largest global airline, in both revenue and profits
• Provides a dividend to investors
• Loyalty program creates reliable customer base, revenue from this part of the business increased 16% 
• All areas of business (leisure, corporate, premium products) have solid single-digit growth in revenue
• Expanding out to India in 2020 for relaunch, expecting continued revenue growth in 2020
• Consistently repurchases stock
• Delta intends to allow all flyers to have access to free wi-fi, should incentivize more customers to use Delta
• Willing to invest money in improving quality of services, seems to want to separate itself from other major airlines
• International joint ventures invest into airline industry beyond United States

Negatives

• Cyclical industry with a 30+% ROE indicates that Delta is being propped up, somewhere near the peak of its valuation 
• Even though other valuation metrics suggest the opposite, Delta might break down in the long run 
• Delta is unlikely to bring reliable earnings growth, issues with expansion and new/existing competitors taking more market share
• Decrease in profit while increase in revenue, indicates either management issues, problematic profit margins, extra costs, etc.

Outlook (Hold)

• One of the better airlines according to customers and attracting consistent revenue despite macroeconomic worries and poor weather conditions
• However, does that warrant investment?
• Hold off and compare Delta with its competitors

​Check Out:

• Annual Report (2019) and 10-Q (Q3 2019)
• Most recent earnings call transcript (Q3 2019)
• Further gain an understanding of airline industry and Delta’s competitors (i.e. Southwest, United, Jetblue, American)
• Analyze Salesforce’s international expansion and especially its recent move into China
• Determine management competence under Delta's CEO, Ed Bastian; President, Glen Hauenstein; and CFO, Paul Jacobson
• Properly model out different potential valuations of Delta (i.e. DCF model)

General Info

• Sector/Industry: Technology/Software — Applications
• Forward PE: 53.19 (Industry Median: 25.42)
• PE: 135.73 (Industry Median: 25.06)
• Net Profit Margins: 6.45% (Industry Median: 2.52%)
• Price/Book: 7.33 (Industry Median: 2.81)
• Return on Equity: 6.13% (Industry Median: 5.26%)
• Revenue CAGR: 25.83%
• Income CAGR: 148.58%
• Currently sitting at approximately $160 share price; sits approximately above the 50 and 200 day moving average
• Basic Description: Salesforce is a company that focuses on providing an integrated customer relationship management software experience for businesses. Essentially, the software solutions provided by Salesforce aim to connect clients with customers and sustain those connections. Salesforce carries various options/apps (e.g. Sales Cloud, Service Cloud, Marketing and Commerce Cloud) that can be consolidated into their Customer 360 experience that brings all elements of customer relations together for businesses.

Positives

• Extremely high income growth coupled with consistent double-digit revenue growth
• Recent acquisitions in Tableau, Salesforce.org, ClickSoftware have generated organic growth and contribute to positive, sustained growth as Salesforce implements into Customer 360 experience
• Leader in CRM business, leading Customer 360 software solution has generated 4 million sale opportunities and 4.3 million leads
• AI software (named Einstein) increases profit margins for Salesforce, decreases employees required to solve or attend to more simple CRM problems
• In Q2, Salesforce expanded Customer 360 to include Salesforce Blockchain, Salesforce Maps, which have been quite effective to pinpoint customers and add the world’s first Blockchain solution for CRM
• Salesforce is known to be one of the best places to work (92% of employees say Salesforce is a great place to work), adds to employee efficiency and attracts better employees
• Microsoft, Airbnb, L ‘O’Real, Alibaba are just a few companies that Salesforce has recently developed relationships with in order to improve sales, marketing, or customer service
• Momentum for Salesforce business in financial services industry (i.e. new relationship with Unicredit in Italy)
• US federal government has increased its investment in Salesforce, especially for Bureau of Land Management, the USDA and U.S. Department of Housing and Urban Development
• More of a long-term solution for companies, can produce stable income even through economic downturn, especially through product and international diversification
• Global partner certifications are up 40% year over year
• Marc Benioff/Keith Block at Co-CEO position have both done relatively solid jobs of steering the company ahead and taking advantage of digital trend

Negatives

• Highly valued given the current earnings and industry conditions
• Raises questions of the certainty of growth in stock given the currently high valuations
• Complex system that begins to discourage small business use, requires high levels of commitment to the software and time to learn how to properly use
• Lack of innovation and product uniqueness will prove difficult to sustain over years and years of existing and incoming CRM competition
• Competition from Microsoft and Oracle
• Near the stock’s 52 week high of $167 per share

Outlook (Hold)

• Although positives significantly beat out the negatives, the considerable chance that Salesforce is overvalued pushes most risk-averse investors to keep this one on the sidelines
• Definitely a stock to keep track of and prioritize on watchlist

​Check Out:

• Annual Report (2019) and 10-Q (Q1 2019)
• Most recent earnings call transcript (Q2 2019)
• Become familiar with some of Salesforce’s products 
• Analyze Salesforce’s international expansion and especially its recent move into China
• Determine management competence under Co-CEOs, Marc R. Benioff and Keith G. Block
• Properly model out different potential valuations of Salesforce (i.e. DCF model)

​Disclaimer: Please research these stocks yourself to get a full, confident understanding before investing! These features are merely a recommendation, not a promise of profit or an endorsement.

Disclaimer: Please research these stocks yourself to get a full, confident understanding before investing! These features are merely a recommendation, not a promise of profit or an endorsement.

​Disclaimer: Please research these stocks yourself to get a full, confident understanding before investing! These features are merely a recommendation, not a promise of profit or an endorsement.

Additional disclaimer:  Apologies for the delay; our team took a one-month summer break!

General Info

• Sector/Industry: Financial Services/Capital Markets
• Forward PE: 8.2 (Industry Median: 18.52)
• PE: 8.68 (Industry Median: 16.43)
• Net Profit Margins: 30.12% (Industry Median: 20.94%)
• Revenue CAGR: 2.05%
• Income CAGR: 19.8%
• Currently sitting at approximately $200 share price
• Basic Description: Goldman Sachs is an investment banking and investment management company that specializes in providing its exclusive partners/clients with services most often surrounding mergers/acquisitions, IPOs, debt and equity underwriting, risk management, brokerage services, financial planning, etc.

Positives

• Proven company with solid management team and client loyalty
• Valued at approximately $73 billion despite net income generation of $10.5 billion in 2018, share price seems a bit low
• Diversified revenue stream from four divisions of the company: Investment Banking, Institutional Client Services, Investing & Lending, and Investment Management
• While revenue growth isn’t high, income growth has remained at double digits compounded annually over several years likely due to high profit margins
• Double-digit return on equity reported in the most recent quarter
• Management seemingly moving towards making its client/partner circle more exclusive, creating more demand to be working with GS 
• Apple’s partnership with Goldman Sachs seems interesting, creates an exclusive product that could generate more public interest in financial services sector of Goldman
• Goldman already dominates the investment banking sector, consistently underwrites large deals
• Recently acquired United Capital to pair along with Ayco business in financial executive counseling and investment advisory business
• Generating increasing public interest through Marcus, a commercial bank service offering competitive interest rates for customers
• Currently holds over $90 billion in assets-liabilities, nearly $20 billion more than approximate market cap

Negatives

• Dependent on solid economic growth to perform well in many components of its business
• Over $840 billion in liabilities listed in balance sheet
• Lack of history building consumer relationships outside of high capital clients and into public, unsure about possible performance penetrating commercial banking market and pulling public interest
• Macroeconomic trends and tariff war could threaten GS’s success in the future
• Requires constant innovation to stay afloat over any major economic shifts
• Revenue growth declining, requires greater efficiency which can often be more and more difficult over the years

Outlook (Buy)

• Simply based on proven results of management and long-standing success of business and secure relationships with consumers, GS is a relatively low-risk investment for the long-term
• There may be fluctuations, but GS will likely be able to push through over several years and recover

​Check Out:

• Annual Report (2018) and 10-Q (Q2 2019)
• Most recent earnings call transcript (Q2 2019)
• Analyze the investment banking competition (JPM, Blackstone, UBS, Bank of America Merrill Lynch, etc.)
• Develop greater knowledge about macroeconomic environment 
• Determine management competence under David Michael Solomon (CEO)