Morgan Stanley said robust dealmaking and wealth management revenues pushed quarterly profits 10 percent higher from a year earlier, beating analysts’ expectations.
The Wall Street behemoth reported a profit of $3.51 billion, or $1.85 a share, on revenue of $14.76 billion. Analysts had predicted the bank would report $1.65 a share on revenue of $13.98 billion, according to data from FactSet.
Morgan Stanley’s investment banking revenue — up 16 percent from last year — helped push its numbers higher. As the economy comes roaring back, dealmaking, capital raising and IPOs have lifted all major firms’ investment banking revenues, including rivals JPMorgan and Goldman Sachs.
But unlike its peers, Morgan Stanley is starting to see the benefits of its aggressive acquisitions. The bank’s purchase of Eaton Vance last year helped double its investment management revenues from $886 million a year to $1.7 billion this quarter.
Likewise, Morgan Stanley’s 2020 bet on trading platform E*TRADE buoyed its wealth management revenue to $6.1 billion — up from $4.7 billion a year ago.
“With our transformed business model providing more stable and durable earnings, we have doubled our dividend and announced a $12 billion buyback as we move to return our excess capital to shareholders,” CEO James Gorman said in a statement. “Our global franchise is very well positioned to drive further growth.”