Morgan Stanley Stock Gains After Upbeat Q4: Retail Applauds Robust Earnings
The bank’s net earnings more than doubled to $3.71 billion, or $2.22 per share for the quarter ended Dec. 31, compared with Wall Street’s expectations of $1.7 per share in profit.
FollowMorgan Stanley’s shares rose 2.8% on Thursday after the lender topped the market estimate for fourth-quarter profit on higher investment banking and equity revenue.
The bank’s net earnings more than doubled to $3.71 billion, or $2.22 per share for the quarter ended Dec. 31, compared with Wall Street’s expectations of $1.7 per share in profit, according to FinChat data.
Morgan Stanley’s quarterly revenue of $16.22 billion also beat average analysts’ estimate of $15.03 billion.
“Total client assets grew to $7.9 trillion across wealth and investment management supported by markets and healthy net new assets,” CEO Ted Pick said in a statement.
The firm’s institutional services unit's net revenue surged to $7.28 billion, up from $4.94 billion in the year-ago quarter.
Morgan Stanley booked a 25% rise in investment banking revenue on more completed deals. At the same time, its equity underwriting revenue also climbed as its clients strategically raised capital in a more constructive environment.
Its net interest income (NII) in the wealth management unit rose marginally to $1.89 billion as higher yields on the investment portfolio and lending growth offset lower average sweep deposits.
During the reported quarter, the firm’s provision for credit losses ballooned to $115 million from $3 million, primarily due to the commercial real estate sector loans.
Earlier, smaller peer US Bancorp (USB) had flagged a 9.4% increase in provision for credit losses due to higher credit card and commercial real estate loan losses.
Retail sentiment on Stocktwits jumped to ‘extremely bullish’ (88/100) zone from ‘neutral’(51/100) a day ago, while retail chatter remained ‘extremely high.’
MS’s Sentiment Meter and Message Volume as of 11:15 a.m. ET on Jan. 16, 2025 | Source: Stocktwits
One user believes the stock could hit $140, backed by strong bottom-line results.
Another user wrote that the stock deserves an all-time high.
On Wednesday, the bank’s peers JP Morgan, Wells Fargo, and Citigroup had all topped Wall Street estimates.
Over the past year, the stock is up 56%.
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