Citi Research lowered its rating for Goldman Sachs shares to sell from neutral, saying the bank's postelection surge has gone too far.
Goldman shares are up 34 percent versus the 6 percent return since Nov. 8 through Monday.
"We view the banks as trading stocks and following the recent run, we don't really see a compelling risk/reward for the group, While we do not think the group is significantly overvalued, we wanted to address investor questions about which stocks have overshot the most," analyst Keith Horowitz wrote in a note to clients Tuesday. "Based on our work, we see near-term tactical opportunities to trim positions in ... GS."
Horowitz's price target for Goldman is $225, representing 7 percent downside from Monday's close.
The analyst said the bank's current valuation is pricing in $4 billion more revenue than what Wall Street anticipates for the next two years.
"While we expect GS will see improved trading revenues going forward, the path is relatively uncertain and the bar is relatively high," he wrote.
— CNBC's Michael Bloom contributed to this story.