Stocks’ Rally Paves Way for Goldman Sachs IPO

Goldman Sachs Group has earned more than $1 billion in its fiscal first quarter, rebounding from its worst three months since 1994 and putting the biggest investment banking partnership on track to sell public shares by the end of June, people familiar with the firm said Wednesday.

The 129-year-old firm has profited from a market rally that boosted trading, underwriting and mergers during the three months that end Friday. Earnings before taxes and partners’ pay probably will beat the $1.02 billion in the same period of 1998 and could exceed the record $1.04 billion in pretax profit from last year’s second quarter, the people said.

Goldman’s recovery follows trading losses that caused fourth-quarter earnings to plunge 81%, forced the company to delay its initial stock sale and led to the ouster of Jon Corzine as co-chief executive. Now, investors say they’re hungry to buy a piece of the firm.

“I’d love to own Goldman Sachs stock,” said Jon Burnham, manager of the $150-million Burnham fund. “I’d even pay a premium.”