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Morgan Stanley MS earnings 1Q 2022

A display shows the buying and selling info for Morgan Stanley on the ground of the New York Inventory Alternate (NYSE), January 19, 2022.

Brendan McDermid | Reuters

Morgan Stanley on Thursday reported first-quarter earnings that surpassed Wall Road expectations, because of the financial institution’s stable income good points from buying and selling.

Shares of the New York-based financial institution jumped greater than 2% in premarket buying and selling Thursday. Here is how the numbers in contrast with Wall Road expectations:

  • Earnings: $2.02 a share, versus $1.68 a share estimate, in line with Refinitiv
  • Income: $14.8 billion, versus $14.2 billion estimate, in line with Refinitiv

The financial institution noticed stronger-than-expected revenues from fairness and stuck earnings buying and selling amid risky markets and better accomplished M&A transactions.

Morgan Stanley’s fairness buying and selling income got here in at $3.2 billion, increased than an expectation of $2.7 billion, in line with StreetAccount. Mounted earnings income totaled $2.9 billion for the quarter, topping estimate of $2.2 billion from StreetAccount.

“The Agency delivered a powerful ROTCE of 20% within the face of market volatility and financial uncertainty, demonstrating the resilience of our international diversified enterprise,” James Gorman, chairman and CEO, stated in a press release.

“Institutional Securities navigated volatility on behalf of purchasers terribly properly, Wealth Administration’s margin proved resilient and the enterprise added $142 billion web new property within the quarter, and Funding Administration benefited from its diversification,” Gorman stated. “The quarter’s outcomes affirm our sustainable enterprise mannequin is properly positioned to drive progress over the long run.”

Wall Road banks are grappling with a sudden slowdown in mergers-related advisory charges and a pointy drop in IPO exercise within the first quarter, a reversal of the growth that fueled final yr’s sturdy outcomes. The change was triggered by inventory market declines and Russia’s invasion of Ukraine, forces that made markets much less hospitable for offers and public listings.

The supply of the opposite half of Morgan Stanley’s income, the financial institution’s large wealth administration and funding administration divisions, did not maintain up as properly, nevertheless.

Its income from wealth administration totaled $5.9 billion, flat from a yr in the past however lacking an estimate of $6.2 billion, in line with StreetAccount.

Morgan Stanley’s funding banking income additionally disenchanted, coming in at $1.6 billion, marking a 37% lower from yr in the past and decrease than a $1.8 billion estimate per StreetAccount. The slowdown was because of a major lower in fairness underwriting revenues, the financial institution stated.

— CNBC’s Hugh Son contributed reporting.

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