Traders Wonder Whether Morgan Stanley Can Continue Banks' Q3 Beat Streak
Investors are awaiting with bated breath the results from the last of the Mohicans among investment banks.
Morgan Stanley (NYSE: MS) is due to release its third quarter results before the markets open on Wednesday.
Analysts, on average, expect earnings of $0.63 per share, up from $0.34 per share last year. Revenues are also expected to rise to $8.17 billion from $7.33 billion in the year-ago period.
If trend is anything to go by, Morgan Stanley could be gearing up for beats on both the top and bottom line. Fixed income trading revenues offered a cushion for most banks, which have reported already. For Morgan Stanley, fixed income trading revenues make up roughly 16 percent of total revenues.
Q3 Banking Recap Thus Far
- Bank of America Corp (NYSE: BAC) stood tall and towering with 7.90 percent earnings per share growth, with the increase marking the first in three quarters. The company's revenues grew 2.86 percent to $21.6 billion and exceeded estimates by 3.15 percent.
- Citigroup Inc (NYSE: C) reported earnings per share of $1.24, down 8.15 percent year-over-year, and yet beat the $1.16 per share consensus estimate. Revenues declined 4.81 percent to $17.8 billion, but beat estimates by 2.65 percent.
- Goldman Sachs Group Inc (NYSE: GS) steamrolled past the $3.79 estimate, with earnings per share at $4.88, up notably from $2.90 last year. Revenues also trumped estimates.
- JPMorgan Chase & Co. (NYSE: JPM)'s third-quarter earnings per share fell 5.95 percent to $1.58 but were ahead of the $1.39 per share consensus estimate. The company reported a 8.37 percent increase in its managed net revenues to $23.54 billion, with revenues exceeding estimates by roughly 2 percent.
- Wells Fargo & Co (NYSE: WFC), which created a furor with its sales practices scandal, also saw a modest drop in its earnings per share to $1.03, although the metric was 1.98 percent ahead of estimates.
Barclays said in a note last week that it expects Morgan Stanley to report overwhelming results, given a better FICC environment. The firm forecasts ROE in the 8 percent area.
At time of writing, shares of Morgan Stanley were up 1.24 percent at $32.19.
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