Morgan Stanley (NYSE:MS) third-quarter performance exceeded Wall Street expectations, driving its stock up by over 7% intra-day on Wednesday. With solid results across key business segments, the company showcased the resilience and effectiveness of its diversified approach to financial services.
For the quarter, Morgan Stanley reported an EPS of $1.88, surpassing the anticipated $1.59. Revenue hit $15.4 billion, significantly outpacing forecasts of $14.32 billion and marking a 15.8% increase from the same period last year.
Morgan Stanley’s Institutional Securities division posted a 20.2% year-over-year increase in net revenues, reaching $6.8 billion. This was fueled by robust performances in both Equity and Fixed Income trading, alongside notable progress in Investment Banking. The Investment Banking unit, in particular, saw revenues climb 56% from a year prior, driven by substantial gains in equity and fixed income underwriting.
The Wealth Management segment also delivered record-breaking net revenues, reaching $7.3 billion, a 13.5% year-over-year boost. This growth reflected strong asset management and transaction-based income, with the division attracting an additional $64 billion in net new assets. Total client assets in the division now stand at an impressive $6 trillion.
CEO Ted Pick highlighted the firm’s strategic success, noting that the third-quarter results underscored Morgan Stanley’s capacity to generate solid returns and build capital in a favorable market environment. Through the first three quarters of 2024, the firm reported a return on tangible common equity (ROTCE) of 18.2%.
Closing out the quarter, Morgan Stanley recorded a Common Equity Tier 1 (CET1) capital ratio of 15.1%, adding $2.1 billion in CET1 capital during the period.