Barclays on U.S. Brokers, Asset Managers & Exchanges: Weekly Capital Markets Conditions Update
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Price: $1,039.28 +3.73%
Rating Summary:
16 Buy, 23 Hold, 2 Sell
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Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
16 Buy, 23 Hold, 2 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Barclays on U.S. Brokers, Asset Managers & Exchanges: Weekly Capital Markets Conditions Update
Analyst, Roger A. Freeman, said, "Goldman Sachs (NYSE: GS) reported 3Q11 EPS loss of $0.84, below our $0.35 loss estimate, principally driven by a larger-than-expected loss in the investing and lending business, partially offset by a better-than-expected core equities trading revenue. MS reported core EPS of about $0.02, vs. our $0.23 EPS core loss estimate, driven by small beats in most of the revenue lines and good expense discipline. With broker shares recently outperforming, we believe that investors have quickly digested a disappointing 3Q. However, we do not believe the capital markets environment has fully healed. That being said, as the prior crisis showed, the period of most intense stress was followed by some of the highest client flow revenues. With GS shares trading at 0.8x P/B and Morgan Stanley (NYSE: MS) shares trading at 0.6x P/B, we believe long-term investors may be rewarded to dip their toe in here with the caveat that there may be significant volatility before the industry proves itself worthy of a premium to book, something that we are convinced they will eventually be able to earn, though perhaps not for some time."
E-BROKERS: Charles Schwab (Nasdaq: SCHW) reported 3Q11 EPS of $0.18, below our $0.19 estimate, driven by higher money market fee waivers. E*TRADE (Nasdaq: ETFC) reported 3Q11 core EPS of about $0.16, below our comparable $0.19 est. mostly due to lighter-than-expected non-interest revenue."
Other stocks mentioned in the report include: Janus Capital (NYSE: JNS) and MF Global (NYSE: MF)
Analyst, Roger A. Freeman, said, "Goldman Sachs (NYSE: GS) reported 3Q11 EPS loss of $0.84, below our $0.35 loss estimate, principally driven by a larger-than-expected loss in the investing and lending business, partially offset by a better-than-expected core equities trading revenue. MS reported core EPS of about $0.02, vs. our $0.23 EPS core loss estimate, driven by small beats in most of the revenue lines and good expense discipline. With broker shares recently outperforming, we believe that investors have quickly digested a disappointing 3Q. However, we do not believe the capital markets environment has fully healed. That being said, as the prior crisis showed, the period of most intense stress was followed by some of the highest client flow revenues. With GS shares trading at 0.8x P/B and Morgan Stanley (NYSE: MS) shares trading at 0.6x P/B, we believe long-term investors may be rewarded to dip their toe in here with the caveat that there may be significant volatility before the industry proves itself worthy of a premium to book, something that we are convinced they will eventually be able to earn, though perhaps not for some time."
E-BROKERS: Charles Schwab (Nasdaq: SCHW) reported 3Q11 EPS of $0.18, below our $0.19 estimate, driven by higher money market fee waivers. E*TRADE (Nasdaq: ETFC) reported 3Q11 core EPS of about $0.16, below our comparable $0.19 est. mostly due to lighter-than-expected non-interest revenue."
Other stocks mentioned in the report include: Janus Capital (NYSE: JNS) and MF Global (NYSE: MF)
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