During the last bull market from late 2002 to late 2007, Goldman Sachs (GS) was a market leader. On most days, all you had to do was look at how Goldman was doing, and you knew that the overall market would soon follow in the same direction. During the current bull market, however, Goldman has been anything but a market leader, and as the months pass, Goldman's price action seems to get less and less attention.
The charts below highlight Goldman's current funk. Over the past six months, the stock has gone nowhere. Today's move lower puts it at the exact same level it was trading at last October. Over the same time period, the S&P 500 has trended nicely higher and is up 10%.
The relative strength chart of Goldman versus the S&P 500 going back to 2000 shows just how different the stock's action has been during the current bull market versus the last bull. When the line in the chart is rising, Goldman is outperforming the S&P 500, and vice versa for a declining line. From 2002 to 2007, the stock outperformed the market as both were rising. At the outset of the current bull market, Goldman outperformed the S&P as well, but the stock hit a wall in late 2009, and it has been underperforming ever since. Now investors are starting to wonder when or if the stock will ever be a leader again.