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Non-Tech : Auric Goldfinger's Short List -- Ignore unavailable to you. Want to Upgrade?

To: Ben Wa who wrote (9741)	4/27/2002 4:20:08 PM
From: StockDung	Respond to of 19428

THE BAAZAR->Goldman May Rally, Merrill Says: Call of the Day (Update1) By David Wells New York, April 26 (Bloomberg) -- Goldman Sachs Group Inc. may be able to dodge lawsuits by individual investors alleging conflicts of interest between research analysts and investment bankers, Merrill Lynch & Co. analyst Judah Kraushaar says. Kraushaar, whose company is the largest by number of brokers, advised investors to buy shares of the third-largest securities firm by capital, arguing that Goldman's client base of wealthy individuals and institutions is less likely to sue than mass- market customers. Class-action and state lawsuits on behalf of brokerage clients are brewing now that the Securities and Exchange Commission and New York State Attorney General Eliot Spitzer are investigating whether Wall Street firms issued favorable research to gain investment-banking clients, some investors say. ``There is some merit in the idea that litigation will derive from individual investors, not institutions,'' said William Batcheller, who helps manage about $2 billion for National City Corp. Batcheller said he has kept his Goldman stock while selling his Merrill shares as the investigation intensified. Today, David Komansky, Merrill's chairman and chief executive officer, apologized for e-mails sent by some of the firm's research analysts that denigrated stocks it recommended investors buy. Kraushaar, who didn't immediately return calls seeking comment, raised Goldman to ``buy'' from ``neutral,'' saying the stock may reach $94 in the next year -- a 22 percent gain from yesterday's closing price of $77.21. Goldman shares rose for the first time this week, gaining $1.94 to $79.15 and outpacing shares of the three firms with the most brokers -- Merrill, Morgan Stanley Dean Witter & Co. and Citigroup Inc. Merrill climbed 88 cents to $43.38, Morgan Stanley fell 8 cents to $48.05 and Citigroup, the parent of Salomon Smith Barney Inc., declined $1.10 to $43.05. Lower Forecasts Kraushaar, the top-ranked bank analyst in Institutional Investor magazine's 2001 poll of money managers, cut his fiscal 2002 earnings estimate for Goldman to $4.80 a share from $4.90 and his 2003 forecast to $5.70 from $5.85. The consensus among analysts surveyed by Thomson Financial/First Call is $4.46 for 2002 and $5.48 for 2003. Still, Kraushaar said the firm's diversification of revenue has reduced its reliance on investment-banking fees and staff reductions are lowing operating costs and could help Goldman boost profits. He added the risk of Goldman's stock falling in May and June when employees start selling shares awarded to them during the firm's 1999 IPO is lower than some investors expect because the amount of shares Goldman can sell each day is limited. ``Ultimately, the improved public trading liquidity should be a plus,'' Kraushaar wrote. Merrill is a passive, minority investor in Bloomberg LP, parent of Bloomberg News.