Morgan Stanley (NYSE:MS) shares lose ground on Friday, as the company posted third-quarter results that missed analysts’ expectations as investment banking revenue collapsed by 55%.
Earnings Per Share proved $1.47, compared with $1.49 estimate of analysts,
Revenue was $12.99 billion, compared with the $13.3-billion estimate.
The New York-based bank said profit of $2.63 billion, or $1.47 a share, fell 29% from a year earlier. Revenue of $12.99 billion dropped 12% from a year earlier, driven by the falloff in investment banking and declines in investment management revenue.
Investment banking revenue fell 55% to $1.28 billion in the quarter, essentially matching the estimate of analysts. Investment management revenue, however, dropped 20% to $1.17 billion, which was below the $1.29 billion estimate.
Morgan Stanley’s investment banking, trading and investment management operations are all impacted by the vagaries of the market, and the quarter was a choppy one.
Wall Street banks are grappling with the collapse in IPOs and debt and equity issuance this year, a sharp reversal from the deals boom that drove results last year. The slowdown was triggered by broad declines in financial assets, recession concerns and the Ukraine war.
Shares of the bank have dropped 19% this year through Thursday, holding up better than the 25% decline of the KBW Bank Index.
MS shares ducked $1.26, or 1.6%, to $78.06.
