EmailStory Stocks®
Archive
Last Update: 19-Oct-11 10:53 ET
Morgan Stanley Tops Third Quarter Revenue Expectations
Morgan Stanley (MS $17.29 +0.66) reported third quarter earnings of $1.14 per share, may not be comparable to the Capital IQ Consensus Estimate of $0.32.
Revenues rose 45.6% year/year to $9.9 billion versus the $7.25 bln consensus. Results included revenues of $3.4 billion, or $1.12 per diluted share, from the widening of Morgan Stanley's debt-related credit spreads.
The Firm's compensation expense for the current quarter was $3.7 billion with a compensation to net revenue ratio of 37%. This ratio was affected by DVA which increased net revenues in the current period. Non-compensation expenses of $2.5 billion reflected higher levels of business activity and costs associated with the U.K. bank levy.
Investment Banking revenues were $864 million. Sales and trading net revenues were $5.4 billion and included positive revenue of $3.4 billion related to DVA. Global Wealth Management Group delivered net revenues of $3.3 billion, with net new assets for the quarter of $15.5 billion, a record since the inception of the Morgan Stanley Smith Barney joint venture (MSSB), and net flows in fee-based accounts of $10.1 billion. Morgan Stanley successfully completed its inaugural offering of JPY 46.5 billion (approximately $600 million) Uridashi bonds leveraging the strength of our partnership with Mitsubishi UFJ Financial Group, Inc. (MUFG).
Advisory revenues of $413 million increased 11% from a year ago reflecting higher levels of completed activity. Underwriting revenues of $451 million declined 29% from last year's third quarter on lower levels of market activity. Equity underwriting revenues of $239 million declined 8% from a year ago. Fixed income underwriting revenues of $212 million declined 44% from last year's third quarter primarily reflecting lower high yield and investment grade bond issuance volumes.
Fixed Income and Commodities sales and trading net revenues were $3.9 billion and included positive revenue of $2.8 billion related to DVA. Equity sales and trading net revenues were $2.0 billion and included positive revenue of $620 million related to DVA. Results in the cash and derivatives businesses reflected high levels of client activity and market volumes. Other sales and trading net losses of $443 million, primarily reflected writedowns associated with corporate lending activity. Morgan Stanley's average trading Value-at-Risk measured at the 95% confidence level was $130 million compared with $145 million in the second quarter of 2011 and $142 million in the third quarter of the prior year.
Revenues rose 45.6% year/year to $9.9 billion versus the $7.25 bln consensus. Results included revenues of $3.4 billion, or $1.12 per diluted share, from the widening of Morgan Stanley's debt-related credit spreads.
The Firm's compensation expense for the current quarter was $3.7 billion with a compensation to net revenue ratio of 37%. This ratio was affected by DVA which increased net revenues in the current period. Non-compensation expenses of $2.5 billion reflected higher levels of business activity and costs associated with the U.K. bank levy.
Investment Banking revenues were $864 million. Sales and trading net revenues were $5.4 billion and included positive revenue of $3.4 billion related to DVA. Global Wealth Management Group delivered net revenues of $3.3 billion, with net new assets for the quarter of $15.5 billion, a record since the inception of the Morgan Stanley Smith Barney joint venture (MSSB), and net flows in fee-based accounts of $10.1 billion. Morgan Stanley successfully completed its inaugural offering of JPY 46.5 billion (approximately $600 million) Uridashi bonds leveraging the strength of our partnership with Mitsubishi UFJ Financial Group, Inc. (MUFG).
Advisory revenues of $413 million increased 11% from a year ago reflecting higher levels of completed activity. Underwriting revenues of $451 million declined 29% from last year's third quarter on lower levels of market activity. Equity underwriting revenues of $239 million declined 8% from a year ago. Fixed income underwriting revenues of $212 million declined 44% from last year's third quarter primarily reflecting lower high yield and investment grade bond issuance volumes.
Fixed Income and Commodities sales and trading net revenues were $3.9 billion and included positive revenue of $2.8 billion related to DVA. Equity sales and trading net revenues were $2.0 billion and included positive revenue of $620 million related to DVA. Results in the cash and derivatives businesses reflected high levels of client activity and market volumes. Other sales and trading net losses of $443 million, primarily reflected writedowns associated with corporate lending activity. Morgan Stanley's average trading Value-at-Risk measured at the 95% confidence level was $130 million compared with $145 million in the second quarter of 2011 and $142 million in the third quarter of the prior year.
