Morgan Stanley earnings top estimates fueled by trading revenue gains

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A screen displays the trading information for Morgan Stanley on the floor of the New York Stock Exchange (NYSE), January 19, 2022.
Brendan McDermid | Reuters

Morgan Stanley is set to report first-quarter earnings before the opening bell on Thursday. Here’s what Wall Street expects:

  • Earnings: $1.68 a share, 23% lower than a year earlier, according to Refinitiv
  • Revenue: $14.3 billion, 8.9% lower than a year earlier
  • Wealth management: $6.18 billion, according to StreetAccount
  • Trading: Equities $2.72 billion, Fixed Income $2.22 billion
  • Investment Banking: $1.74 billion

How well did Morgan Stanley’s traders and bankers navigate a difficult quarter? That’s the question for the New York-based bank, which gets roughly half its revenue from trading and investment banking operations.

Wall Street banks are grappling with a sudden slowdown in mergers-related advisory fees and a sharp drop in IPO activity in the first quarter, a reversal of the boom that fueled last year’s strong results. The change was triggered by stock market declines and Russia’s invasion of Ukraine, forces that made markets less hospitable for deals and public listings.

The source of the other half of Morgan Stanley’s revenue, the bank’s giant wealth management and investment management divisions, may hold up better, but analysts still expect lower stock values to reduce revenue in the quarter.

— CNBC’s Hugh Son contributed reporting.

Sophie Tremblay

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