Bove cut Goldman’s price target to $182 from $200 and 2010 earnings per share estimates to $17.17 from $18.72.
Bove said he also lowered earnings per share estimates for Morgan Stanley and other smaller companies in the banking sector.
"This quarter is just not going to produce much business for any one of these companies," he said.
And this environment ultimately will impact financials like JPMorgan , Citigroup and Bank of America , he said.
In April, Goldman was accused of securities fraud in a civil suit filed by the SEC, which claimed the bank created and sold a mortgage investment that misstated and omitted important facts.
However, Bove said his price target cuts are unrelated to the SEC charges.
“It has everything to do with fears in Europe, the fears in the financial markets and the widening of the spreads,” he said. “This earnings reduction and the reduction of the price target of the stock is solely due to the fact that business is lousy.”
Previously, Bove had said financial regulatory reforms likely will pressure bank stocksdown another 10 to 12 percent, but the damage will only be temporary until the industry adjusts.
"They may fall another 10 to 12 percent reflecting market fears but they are still very attractive investments," Bove wrote in a note to clients on May 20. "Longer term, I still expect that these stocks will grow in multiples, not percentages."
Scorecard — What He Said:
- Bove's Previous Appearance on CNBC (May 18, 2010)
CNBC Data Pages:
No immediate information was available for Bove or his firm.