Morgan Stanley (MS) Posts Q3 EPS of 34c, ex. DVA

Morgan Stanley (NYSE: MS) reported Q3 EPS of $0.34, which may not compare with the analyst estimate of $0.63. Revenue for the quarter came in at $7.8 billion versus the consensus estimate of $8.54 billion.

EPS and revenue were down 47% and 12% from last year, respectively.

Business Overview

• Institutional Securities net revenues excluding DVA were $3.5 billion reflecting continued strength in Equity sales and trading, leadership in Investment Banking with notable strength in M&A and underperformance in Fixed Income & Commodities sales and trading.10
• Wealth Management reported a pre-tax margin of 23% for the quarter on lower revenues of $3.6 billion.6 Fee based asset flows for the quarter were $7.7 billion.
• Investment Management net revenues were $274 million reflecting losses in the Merchant Banking business, specifically in Asia private equity. Assets under management or supervision were $404 billion at the end of the quarter.

James P. Gorman, Chairman and Chief Executive Officer, said, “The volatility in global markets in the third quarter led to a difficult environment, impacting in particular our Fixed Income business and our Asia Merchant Banking business. The Firm benefited from the stability of the Wealth Management business, our ongoing leadership in Equities and the continued strength of our Investment Banking franchise. Our business model provides a steady foundation for the Firm as we navigate these challenging markets and focus intensely on addressing areas of underperformance.”

For earnings history and earnings-related data on Morgan Stanley (MS) click here.

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