Goldman Sachs's Stock Falls After Analyst Downgrade

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Goldman Sachs Group's stock shed 1.5% in morning trade Friday, after Keefe, Bruyette & Woods downgraded the broker, citing concerns that a full valuation will limit potential upside. Analyst Brian Kleinhanzl lowered his rating to market perform from outperform. Meanwhile, he raised his stock price target to $210, which is just 6.5% above current prices, from $195. "Shares of [Goldman] has a strong run into 1Q results, but within this quarter's results, we did not see enough to move our 2016 estimates materially higher," Kleinhanzl wrote in a note to clients. "We do not believe that a larger premium to forward book value is warranted at this time since the volatility of Goldman's earnings is still high and visibility into forward earnings [is] low." The stock rallied 5.3% in the two weeks leading up to Goldman's results, which were released ahead of Thursday's open, to close at a seven-year high on Wednesday. It has rallied 11% in the past three months, while the S&P 500 has gained 3.4%.

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