Morgan Stanley exceeded analysts' expectations for third-quarter earnings on Wednesday, driven by robust performances across its three core divisions.
The bank reported earnings of $1.88 per share, surpassing $1.58 per share expected, while revenue surged to $15.38 billion, well above the $14.41 billion forecast.
The firm’s profit jumped 32% to $3.2 billion, with revenue rising 16% year-on-year, benefiting from positive market conditions. A rebound in investment banking and strong trading activity, combined with the Federal Reserve's rate reductions, bolstered Morgan Stanley’s performance.
Ted Pick, Chief Executive Officer, said, "Our business model is delivering strong returns while accreting capital, producing an ROTCE of 18.2% through the first three quarters of 2024. Our management continues to be focused on driving durable growth and realizing long-term returns for our shareholders.”
Morgan Stanley's wealth management division delivered a 14% revenue increase to $7.27 billion, beating estimates by nearly $400 million.
Equity trading revenue surged 21% to $3.05 billion, exceeding the $2.77 billion estimate, while fixed-income trading grew 3% to $2 billion, surpassing expectations.
Investment banking was a standout, with revenue rising 56% to $1.46 billion, above the $1.36 billion estimate. Investment management also posted a 9% revenue increase to $1.46 billion, slightly higher than anticipated.
CEO Ted Pick attributed the strong results to a "constructive environment" globally, positioning the bank well for future growth.
Other Wall Street firms, including JPMorgan Chase, Goldman Sachs, and Citigroup, also posted better-than-expected results, buoyed by strong trading and investment banking revenues.
As of 8:21 am (AEDT), Thursday, October 17, Morgan Stanley (MS) stock was trading at US$119.52, showing a significant increase of 6.51% from the previous close of $112.22. The stock reached a day low of $116.50 and a day high of $121.45. Morgan Stanley's market cap stands at $193.37 billion.