Morgan Stanley Earnings: What To Look For From MS

Global financial services firm Morgan Stanley (NYSE:MS) will be reporting earnings this Thursday before the bell. Here’s what investors should know.

Morgan Stanley beat analysts’ revenue expectations by 9.2% last quarter, reporting revenues of $18.22 billion, up 18.5% year on year. It was an incredible quarter for the company, with a beat of analysts’ EPS estimates and a solid beat of analysts’ revenue estimates.

Is Morgan Stanley a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.

This quarter, analysts are expecting Morgan Stanley’s revenue to grow 8.9% year on year to $17.66 billion, slowing from the 25.8% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $2.42 per share.

Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Morgan Stanley has a history of exceeding Wall Street’s expectations, beating revenue estimates every single time over the past two years by 6.3% on average.

Looking at Morgan Stanley’s peers in the capital markets segment, some have already reported their Q4 results, giving us a hint as to what we can expect. Jefferies delivered year-on-year revenue growth of 5.7%, beating analysts’ expectations by 3%, and BNY reported revenues up 6.8%, topping estimates by 0.7%. Jefferies traded up 358% following the results while BNY was down 49.4%.

Read our full analysis of Jefferies’s results here and BNY’s results here.

There has been positive sentiment among investors in the capital markets segment, with share prices up 2.5% on average over the last month. Morgan Stanley is up 2.6% during the same time and is heading into earnings with an average analyst price target of $185.33 (compared to the current share price of $182.63).

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