Morgan Stanley Earnings: Beats Street Despite Swinging to a Loss

S&P 500 (NYSE:SPY) component Morgan Stanley (NYSE:MS) dropped to a first quarter loss, but results topped expectations. Morgan Stanley provides financial products and services to a group of clients and customers, including corporations, governments, financial institutions, and individuals.

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Morgan Stanley Earnings Cheat Sheet for the First Quarter

Results: Reported a loss of $78 million (6 cents per diluted share) in the quarter. Morgan Stanley had a net income of $964 million or 50 cents per share in the year-earlier quarter.

Revenue: Revenue was $6.93 billion last quarter.

Actual vs. Wall St. Expectations: Morgan Stanley reported adjusted net income of 77 cents per share. By that measure, the company beat the mean estimate of 45 cents per share. It fell short of the average revenue estimate of $7.31 billion.

Quoting Management: James P. Gorman, Chairman and Chief Executive Officer, said, “This quarter is further evidence that Morgan Stanley has rebounded from the financial crisis of 2008 and is in a significantly stronger position. Revenues of $8.9 billion, excluding the impact of DVA, were higher on both a year-over-year and a quarter-over-quarter basis. Of particular note was the strength in sales and trading, which showed broad-based gains across products and regions. In addition, our global alliance with MUFG continues to strengthen, with improving operating performance in our securities joint venture in Japan and continued loan growth in the U.S. On the near horizon, we are intensely focused on completing the transition of Morgan Stanley Smith Barney to the new, state-of-the-art technology platform this summer, as well as maintaining a conservative capital and liquidity profile as we navigate global markets.”

Key Stats:

The company has now topped analyst estimates for the last four quarters. It beat the mark by 44 cents in the fourth quarter of the last fiscal year, by 80 cents in the third quarter of the last fiscal year, and by 25 cents in the second quarter of the last fiscal year.

Looking Forward: The average estimate for the second quarter is steady at 50 cents a share. The average estimate for the fiscal year has seen a bump from $1.96 per share sixty days ago to $1.97.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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