Leading companies think otherwise. Today were 3 important mergers announced (or at least intended):
Google paid $3.2 Billion for Nest, a home automation startup who´s products include Internet-connected thermostats and smoke detectors.
Charter Communication offered $61 Billion for Time Warner Cable and got rejected by the object of desire who claims that the price is too low.
Suntory, a gigantic Japanese producer of spirits, wants to buy the maker of Jim Bean whiskey for $13.6 Billion.
Those mergers show that Goldman Sachs` warning is just noise. The buyers don´t believe that stocks are lofty valued. Instead their offers signal that Google, Suntory & Co. think that stocks are still cheap, otherwise they wouldn`t take the costs & risk of a merger. Those companies should have a much better understanding of their markets than a bank. Maybe investors should ignore Goldman Sachs and follow the buyers.