Morgan Stanley shares are jumping as its better-than-expected second-quarter earnings report showed the bank’s dealmakers posted the biggest gains on Wall Street. Key topics on the bank’s conference call included the firm’s institutional securities business turning in its best first half since 2007, and the bank’s strong pipelines.
“If only all results could be this easy,” Bloomberg Intelligence’s Alison Williams said, flagging broadly stronger revenue, solid cost control and return on tangible equity.
Here’s a sample of analyst commentary:
Evercore ISI, Glenn Schorr
“Good quarter as results beat estimates by a little across each of the businesses with the most upside in equity trading (+8 cents) and M&A (+5 cents) in addition to the consistently strong wealth management numbers.”
“We think the only real picking point for people will be the 3 percent rise” in wealth management net interest income “despite solid growth in loans, client balances and higher interest rates as Morgan Stanley continues to both share a little with clients and more importantly, attract balances from the other side of their clients’ balance sheet.” That should be good for “long-term profitability and client longevity.”
Opimas, Octavio Marenzi
“It is very hard to find anything to criticize in Morgan Stanley’s latest earnings,” Opimas CEO Marenzi writes in a note. “All lines of business performed well, registering growth. Morgan Stanley’s performance in sales and trading was particularly impressive, especially compared to rival Goldman Sachs.”
Goldman Sachs, Richard Ramsden
“Although investors could question the sustainability of the trading results, given typical capital markets seasonality, we believe that they appear generally broad-based, both by product and geography,” Goldman analyst Ramsden writes in a note.