{"id":2720,"date":"2023-10-18T13:27:26","date_gmt":"2023-10-18T13:27:26","guid":{"rendered":"https:\/\/infundpros.com\/investment\/morgan-stanleys-earnings-fall-10-but-beat-wall-street-expectations\/"},"modified":"2023-10-18T13:27:26","modified_gmt":"2023-10-18T13:27:26","slug":"morgan-stanleys-earnings-fall-10-but-beat-wall-street-expectations","status":"publish","type":"post","link":"https:\/\/infundpros.com\/?p=2720","title":{"rendered":"Morgan Stanley\u2019s earnings fall 10% but beat Wall Street expectations"},"content":{"rendered":"
\n

Morgan Stanley on Wednesday said its third-quarter profit fell 10% amid weakness in its investment banking business, but its trading and asset-management revenue rose.<\/p>\n

Morgan Stanley
\n MS,
\n +2.03%<\/bg-quote>
\n said profit for the three months ending Sept. 30 fell to $2.26 billion, or $1.38 a share, from $2.49 billion, or $1.47 a share, in the year-ago period. <\/p>\n

\n

Analysts tracked by FactSet had expected Morgan Stanley to earn $1.28 a share.<\/p>\n

At the start of the quarter, analysts were expecting earnings of $1.58 a share.<\/p>\n

Revenue fell 1% to $13.27 billion, ahead of the FactSet consensus estimate of $13.22 billion.<\/p>\n

The bank\u2019s 13.5% return on average tangible common equity in the third quarter fell short of the bank\u2019s long-term target of 20%. On a conference call with analysts, the bank forecast a robust deal pipeline for mergers and acquisitions, but not until 2024.<\/p>\n

Morgan Stanley\u2019s stock fell 2.8% in premarket trading on Wednesday.<\/p>\n

Chief Executive James Gorman said the market environment was mixed.<\/p>\n

\u201cOur equity and fixed-income businesses navigated markets well, and both wealth management and investment management produced higher revenues and profits year-over-year,\u201d Gorman said. <\/p>\n

Morgan Stanley\u2019s stock fell 4.4% in the third quarter in a choppy period for bank stocks overall. Prior to Wednesday\u2019s trades, the stock was down just under 10% in the past month, compared with 1.9% drop by the S&P 500
\n SPX.<\/span>\n <\/p>\n

For the third quarter, trading revenue rose 10% in the quarter to $3.68 billion.<\/p>\n

Asset-management revenue increased by 6% to $5.03 billion, while investment-banking revenue dropped 24% to $1.05 billion. <\/p>\n

During the past month, 11 analysts cut their profit estimates for Morgan Stanley and only one increased their view. <\/p>\n

UBS analyst Brennan Hawken downgraded Morgan Stanley to neutral from buy last week, cutting his price target to $84 from $110. <\/p>\n

\u201cDespite its successful transformation into a wealth-management-focused firm with a solid, wire house peer leading growth profile, MS is confronted with obstacles such as deposit sorting\/yield seeking, intense competition for talent, and a challenging revenue environment,\u201d Hawken said.<\/p>\n

The average rating among 26 analysts that cover Morgan Stanley is overweight. <\/p>\n

The bank is in the midst of a leadership transition, with Chief Executive James Gorman planning to step down by next May. Three potential successors at the bank include Andy Saperstein, who heads up wealth management; Ted Pick, who runs capital markets; and Dan Simkowitz, head of investment management. <\/p>\n

Also read: <\/strong>Bank of America\u2019s profit climbs 10%, boosted by interest rates and loans<\/p>\n<\/p><\/div>\n<\/div>\n

Read the full article here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

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