Wells Fargo has lowered its price target on Goldman Sachs (GS) from $720 to $680 while maintaining an Overweight rating ahead of Q1 earnings for large-cap banks. Despite a bullish long-term outlook for the sector, driven by the most significant deregulation in three decades, the firm cautions that Q1 performance may be challenging due to ongoing policy uncertainties.
In a research note, analysts at Wells Fargo revised their earnings estimates downward by 4% for Q1 and by 2% through 2027, citing a “degree of paralysis” in investment banking, lending, asset repricing, and reserves. The uncertain policy environment has led to a more conservative stance on key revenue streams.
While Goldman Sachs faces a lowered price target, Wells Fargo continues to favor Citi (C) and JPMorgan (JPM) as its top picks in the sector. 
