The Goldman Sachs Group, Inc.’s GS upbeat view on global mergers and acquisitions (M&A) signals a potentially strong year ahead for its investment banking (IB) business. With capital markets improving, corporate confidence recovering and private equity exits expected to pick up, the firm sees global dealmaking remaining close to record levels.
At the Bernstein Strategic Decisions Conference held yesterday, Goldman COO John Waldron struck an optimistic tone on the M&A environment. “We’re on track to be near the record, if not breaching the record of 2021,” he said, adding that the firm’s “backlogs feel good and activity is remaining strong.”
The comments reinforce management’s view that M&A momentum has strengthened meaningfully so far this year. Corporate deals have driven M&A activity so far, as companies pursue scale, technology and strategic repositioning. A broader return of private equity firms could further boost dealmaking as sponsors seek exit opportunities.
According to the insights from Goldman Sachs Global Banking & Markets, the global M&A volume is expected to reach $3.8 trillion in 2026, surpassing the $3.6 trillion recorded in 2021. If realized, that would mark a major tailwind for Goldman’s IB business.
GS is already showing signs of strong execution. In the first quarter of 2026, the company maintained its number one ranking in announced and completed M&A, as well as equity and equity-related offerings. IB fees jumped 48% year over year, supported by high levels of client engagement across advisory and underwriting businesses. Management expects activity levels to accelerate in the coming quarters.
Overall, a near-record dealmaking cycle will support Goldman’s fee income, improve operating leverage and reinforce its advisory franchise, while aiding debt underwriting, equity issuance and financing solutions. Though risks remain, including market volatility and geopolitical uncertainty, which could delay large deals. Still, if momentum persists, 2026 could mark one of GS’s strongest IB years since the post-pandemic dealmaking boom.
Major Banks See Rebound in IB & Markets Activity
At the same Bernstein Conference, JPMorgan JPM and Wells Fargo WFC also outlined updated expectations across IB and trading businesses for the second quarter of 2026, driven by improving deal pipelines and stronger capital markets activity.
JPMorgan indicated that IB fees could rise 10% or more year over year. JPMorgan noted that its markets business is also on track to grow 11% in the second quarter and could perform "a little better" than that forecast.
Wells Fargo’s IB and trading revenues are projected to increase year over year in the mid-teens percentage range in the second quarter of 2026. Wells Fargo expects wealth management revenues to grow year over year in the low-double-digit percentage range.
Goldman’s Price Performance, Valuation & Estimates
GS shares have gained 67.9% in the past year compared with the industry’s growth of 23.1%.
Price Performance
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From a valuation standpoint, Goldman trades at a forward price-to-earnings (P/E) ratio of 16.24X, above the industry’s average of 12.65X.
Price-to-Earnings F12M
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The Zacks Consensus Estimate for GS’s 2025 and 2026 earnings implies year-over-year rallies of 16% and 10.5%, respectively. Estimates for both years have been unchanged over the past month.
Estimate Revision Trend
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Goldman currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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