Investors who owned stocks in the 2010s generally experienced some big gains. In fact, the SPDR S&P 500 (NYSE: SPY) total return for the decade was 250.5%. But there’s no question some big-name stocks didn’t keep pace along the way.
One market laggard of the past decade was investment bank Goldman Sachs Group Inc (NYSE: GS).
Goldman Sachs and other U.S. banks were hit hard during the financial crisis in 2008 and 2009. Among the big banks that survived the crisis, Goldman Sachs was considered at the time to be one of the strongest on Wall Street. In fact, Goldman took heat following the crisis for making a $4 billion profit by short selling subprime mortgage backed securities. But even Goldman needed a $5 billion investment from Warren Buffett, a $5 billion public offering in September 2008 and eventually a $10 billion investment from the U.S. Treasury to navigate the worst of the crisis.
Goldman Sachs started the 2010s trading at $173.08 after paying back the U.S. Treasury in full in June 2009. Like many other bank stocks, Goldman Sachs shares quickly hit their low point of the 2010s during the Eurozone debt crisis in 2011, dropping as low as $84.27.
Goldman Sachs shares recovered to as high as $218.77 in mid-2015 before dropping sharply due to a steep decline in trading revenue. Goldman Sachs surpassed its pre-crisis high of $250.70 in early 2018 and eventually made it to its all-time high of $275.31 a few weeks later.
Unfortunately, Goldman shares spent most of the rest of 2018 in a downtrend, pulling back to as low as $151.70 by the end of the year thanks to the company’s involvement with the 1 Malaysia Development Berhad (1MDB) scandal. At least 17 former Goldman executives were charged in connection with allegations by the U.S. Justice Department that $4.5 billion was embezzled in a scandal involving money laundering, abuse of power and corruption on behalf of the former Malaysian prime minister and other politicians.
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Goldman Sachs shares spent most of the second half of 2019 trading in a range between $193 and $225 before finally breaking out in the last two months reaching new 52-week highs at $246.11 just this week.
Despite the bumpy road, Goldman Sachs investors that held on through a volatile decade turned a significant profit, and $100 worth of Goldman Sachs stock bought in 2010 would be worth about $168 today, assuming reinvested dividends.
Looking ahead, analysts expect additional upside for Goldman Sachs will be difficult to come by in 2020. The average price target among the 23 analysts covering the stock is $255, suggesting just 3.8% upside from current levels.