The Goldman Sachs Group, Inc. (GS) saw its stock price climb 5.4% last week, attracting renewed attention from market commentators, including Jim Cramer, who continues to assert that the financial giant trades at a notably low multiple despite its recent gains and robust operational performance. This movement comes as the firm leads the Dow Jones Industrial Average in year-to-date performance, largely driven by a resurgence in capital markets activity and strategic exposure to specialized lending.

Market Performance and Analyst Views

The Goldman Sachs Group, Inc. (GS) stock closed the week 5.4% higher, a significant advance that underscores its strong year-to-date trajectory. As of September 14, 2025, the stock was trading at $780.06, nearing its all-time high of $793.17.

This performance solidifies Goldman Sachs' position as the top-performing stock in the Dow Jones Industrial Average for 2025, with a gain of 37.4% as of Monday's close. This figure surpasses even NVIDIA Corp. (NVDA), which recorded a 32.4% gain over the same period, and JPMorgan Chase & Co. (JPM), which is up 28.9%.

Market strategist Art Hogan of B. Riley Wealth attributes the increased investor interest in Goldman Sachs shares to a rebound in capital-markets activity.

Valuation and Operational Strengths

Despite the impressive stock performance, financial commentator Jim Cramer maintains his long-standing view that Goldman Sachs shares are trading at an unexpectedly low multiple. He noted that even "boring transportation stocks" exhibit higher multiples, and that financial sector price-to-earnings multiples have broadly lagged since 2009. Cramer considers Goldman Sachs "the premier investing house in the world" and has made it one of the largest positions in his trust.

As of mid-September 2025, Goldman Sachs displayed a trailing Price-to-Earnings (P/E) ratio of 17.14, with a forward P/E of 14.93. While this P/E is higher than its ten-year historical average of 12.39, it is still viewed as a potential discount given the firm's growth prospects. On a forward Price-to-Book (P/B) basis, at 2.18x, Goldman Sachs trades at a discount compared to peers like JPMorgan (2.49x) and Morgan Stanley (2.52x), and below the industry average of 2.33x.

The bank's strong performance is rooted in a robust second quarter for 2025, where it reported revenue of $14.58 billion, a 14.6% year-over-year increase, and a net income of $3.47 billion, leading to an Earnings Per Share (EPS) of $10.91, up 27% from the prior year. The Global Banking & Markets segment was a primary driver, with revenue climbing 24% year-over-year, buoyed by a 26% jump in investment banking fees.

Goldman Sachs also exhibits strong profitability, with a profit margin of 28.4% and an operating margin of 35.73%. The company has consistently raised its dividend for 13 consecutive years, with a recent increase from $3.00 to $4.00 per share quarterly, resulting in an annual payout of $16.00 and a dividend yield of 2.05%. This commitment to shareholder returns underscores management confidence.

Strategic Advantage in Specialized Lending

A significant factor contributing to Goldman Sachs' outperformance is its strategic exposure to the rapidly growing sector of providing "warehouse" capital to non-depositary financial institutions (NDFIs) for private-market loans.

Christopher Marinac, a banking analyst with Janney Montgomery Scott, highlights investor excitement around Goldman Sachs' prominent role in this segment. Industry-wide, NDFI loans comprise approximately $1.24 trillion of the $13.05 trillion in total loans among FDIC-regulated banks. This loan type experienced a 20% growth in 2025, significantly outpacing the 2.5% rise in total loans.

Goldman Sachs boasts one of the highest exposures in banking to NDFI lending, which constituted 49.9% of its total loans in the second quarter, up from 48% in the year-ago quarter. This contrasts sharply with JPMorgan, where NDFI transactions represent about 11.8% of its loan portfolio.

Broader Market Context and Outlook

Despite Goldman Sachs' individual strengths, the broader market outlook, as articulated by the firm's own research team, presents a cautious perspective. In August 2025, Goldman Sachs researchers Christian Mueller-Glissmann and Andrea Ferrari warned of an "unfriendly asymmetry" in the stock market, indicating that the next significant move could be a downturn. They noted that the S&P 500 (SPX) has been driven by valuation expansion, while credit spreads have tightened, potentially underestimating economic risks such as slower growth, higher inflation due to tariffs, and geopolitical concerns.

Their analysis suggests an elevated probability of a market pullback due to high and rising valuations coupled with weakening business cycle momentum.

For Goldman Sachs specifically, analysts largely maintain a positive but not overwhelmingly bullish stance. At last check, 41% of analysts tracked by FactSet assigned buy or overweight ratings, 52% were at neutral, and 7% held sell ratings. Consensus price targets for GS range from $538 to $815, with a mean target around $710.58. However, some analysts like Mike Mayo of Wells Fargo have set targets as high as $855.0.

Looking Ahead

The market appears to be incorporating further upside potential for Goldman Sachs, fueled by continued deal-making activity, leadership in capital markets, and operational leverage. Forecasts for EPS growth remain strong, projected at 15% for 2025 and 12% for 2026.

However, the cautious macroeconomic outlook from Goldman Sachs' own research arm regarding potential S&P 500 drawdowns and the implications of tariff uncertainty and weak U.S. growth in the second half of 2025 will be key factors to monitor. The sustainability of Goldman Sachs' premium performance will likely depend on its ability to navigate these broader economic headwinds while capitalizing on its strategic strengths in investment banking and specialized lending.