Morgan Stanley Profit Rises 3%
October 17 2019 - 8:26AM
Dow Jones News
By Liz Hoffman
Morgan Stanley's third-quarter profit rose 3% from a year ago,
the last major U.S. bank to skate through a period of global
tensions and shifting markets.
The bank on Thursday reported a profit of $2.17 billion, or
$1.27 a share, on $10.03 billion in revenue, well above what
analysts had expected. Shares rose 4% in trading before the market
opened.
Analysts polled by FactSet had expected a profit of $1.83
billion, or $1.11 a share, on $9.59 billion in revenue. Morgan
Stanley picked up about 7 cents a share in earnings thanks to a tax
benefit; pretax profits were 5% lower than a year ago.
Morgan Stanley is the last of the big U.S. banks to report
earnings for the third quarter, a stretch in which two Federal
Reserve interest-rate cuts and growing global tensions upended the
relative calm and easy financial policies that have helped banks
thrive in recent years.
The results were mixed: Profits rose at JPMorgan Chase & Co.
and Citigroup Inc., driven by strong consumer-banking businesses.
Goldman Sachs Group Inc., Bank of America Corp. and Wells Fargo
& Co. posted lower profits, though the drops at the latter two
owed largely to one-time charges.
Morgan Stanley's return on equity, a measure of profitability,
was 11.2% for the quarter, versus a range of 9% to 15% at peers
that have already reported.
Chief Executive James Gorman, in the job since 2010, has
transformed Morgan Stanley from Wall Street's problem child into
one of its steadier performers. He cut costs, shrank the firm's
trading division, and doubled down on wealth management, a steadier
business that now accounts for nearly half of Morgan Stanley's
revenue and ties up little of its capital.
Write to Liz Hoffman at liz.hoffman@wsj.com
(END) Dow Jones Newswires
October 17, 2019 08:11 ET (12:11 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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