Goldman Sachs (NYSE:GS) was downgraded by Citi analysts, who cited an inflated valuation. The stock was downgraded from Buy to Neutral with a price target of $400 (from $370). The decision was based on Goldman Sachs trading at approximately 1.3x tangible book value (TBV), which slightly exceeds its historical multiple. According to the analysts, this indicates a balanced risk/reward at the current levels, prompting the downgrade to Neutral.

During its last analyst day, Goldman Sachs presented a 15-17% Return on Tangible Common Equity (ROTCE) target and various Key Performance Indicators (KPIs) for progress tracking. The recent Q2/23 results demonstrated ongoing progress on these KPIs, although the adjusted return was a modest 9%. The analysts believe that achieving the ROTCE target is feasible but will require time and a more favorable investment banking environment.