Morgan Stanley Earnings: Here’s Why Investors are Bidding Shares Higher Now

Morgan Stanley (NYSE:MS) turned profit stronger-than-expected, AND exceeded the revenue expectation. The revenue beat is a positive sign to shareholders focused on a banking turnaround. Shares are up 5.9%.

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Morgan Stanley Earnings Cheat Sheet

Results: Net income increased to $481 million (45 cents per diluted share) in the quarter versus a net loss of $250 million in the year-earlier quarter.

Revenue: Jumped 23% to $7.47 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Morgan Stanley reported adjusted net income of 45 cents per share. By that measure, the company beat the mean analyst estimate of $0.27. It topped the average revenue estimate of $7.02 billion.

Quoting Management: “After a year of significant challenges, Morgan Stanley has reached a pivot point,” CEO James Gorman stated…

…Our firm is now poised to reach the returns of which it is capable on behalf of our shareholders.”

Key Stats:

Revenue increased 2.12% from $6.83 billion in the previous quarter. Net income increased to $481 million in the quarter versus a net loss of $1.02 billion in the previous quarter.

Looking Forward: Analysts have a more positive outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has risen from a profit of $0.57 to a profit $0.58. For the current year, the average estimate has moved down from a profit of $0.23 to a loss of $0 over the last ninety days.

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(Company fundamentals provided by Xignite Financials.)