Investors are set to scrutinize results from Goldman Sachs and J.P. Morgan Chase as banks report third-quarter results starting Tuesday.
Goldman Sachs may take a $264 million writedown on its 1.4% stake in WeWork, Morgan Stanley analysts Betsy Graseck wrote in an Oct. 4 note.
The bank's holdings in WeWork, the co-working company whose valuation plunged after its IPO plans collapsed last month, as well as Uber, which has traded lower after its May listing, probably caused writedowns in the firm's investing and lending division, according to analysts.as banks report third-quarter results starting Tuesday.
Graseck based her estimate in part on guidance Goldman CFO Stephen Scherr has given on how the company values its stakes. A smaller investment bank, Jefferies, announced a $146 million writedown on its WeWork investment last month. While J.P. Morgan, a lead adviser to WeWork, owns a larger stake than Goldman at 4%, Graseck didn't mark down the bank's results. She believes J.P. Morgan hadn't been assigning higher valuations to the start-up as its private market valuation soared.
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