MS Ekes up on Earnings Beat

Morgan Stanley (NYSE:MS) on Thursday beat analysts’ estimates for second-quarter profit as a buoyant stock market helped two of the investment bank’s three main businesses.

The bank posted earnings of $2.2 billion, or $1.23 a share, exceeding the $1.14 estimate of analysts. The company’s revenue came in at $10.24 billion, exceeding the consensus estimate by almost $250 million, on better-than-expected results in the firm’s wealth management and investment management divisions.

Morgan Stanley’s wealth management division, among the world’s largest, posted a record $4.41 billion in revenue, exceeding analyst’s estimate by $60 million. Its investment management division, an asset manager that creates mutual funds, posted $839 million in revenue, exceeding estimates by about $130 million.

The business benefited from "higher assets under management" across asset classes, according to the firm.

Under CEO James Gorman, Morgan Stanley has emphasized its wealth management division, a far steadier business than its trading operations.

The brokerage benefits from rising markets as fees typically climb along with assets under management.

“We reported solid quarterly results across all our businesses,” Gorman said in the earnings release. “We remain focused on serving our clients and pursuing growth opportunities while diligently managing expenses.”

The bank said last month that it won permission from the Federal Reserve to increase its quarterly dividend to 35 cents a share from 30 cents and repurchase $6 billion in shares.

Shares of the firm have climbed 10% so far this year, trailing competitors including Goldman Sachs (NYSE:GS) and J.P. Morgan Chase (NYSE:JPM)

Shares took on five cents to $43.82 soon after Thursday’s open.