Morgan Stanley shares surge 13% in 5 days on strong Q1 performance
Morgan Stanley shares surge 13% in 5 days on strong Q1 performance
Morgan Stanley shares have rallied 13% over the past five sessions, driven by strong quarterly earnings and upbeat market sentiment. The investment bank delivered better-than-expected first-quarter profits, supported by record equity trading and solid growth in its wealth management business.
For the quarter ended March 31, Morgan Stanley reported a net income of $4.3 billion, or $2.60 per share, up from $3.4 billion, or $2.02 per share a year ago. This comfortably beat analysts' expectations of $2.20 per share, according to LSEG estimates.
Key Highlights
Equity trading revenue surged 45% year-on-year, boosted by broad-based gains across businesses and regions, especially in Asia. Prime brokerage and derivatives led the growth.
Wealth management revenue rose to $7.3 billion, up from $6.9 billion a year earlier, driven by increased client activity amid portfolio rebalancing.
Investment banking revenue climbed 8%, supported by strong advisory services and fixed-income underwriting.
Institutional Securities revenue reached $9 billion, compared to $7 billion last year.
CEO Ted Pick struck a more optimistic tone than peers on the future of dealmaking, despite market uncertainties from potential U.S. tariffs. While some deals were delayed, Pick noted companies remain ready to move forward, particularly if tax cuts and deregulation materialize.
CFO Sharon Yeshaya echoed this sentiment, stating that the bank's transaction pipeline remains healthy and resilient.
Notable Deals & Transactions
Advised Walgreens on its $24 billion take-private deal with Sycamore Partners.
Served as lead underwriter for AI cloud firm CoreWeave’s $1.5 billion U.S. IPO.
Booked a significant profit from the sale of a loan related to the 2022 acquisition of social media platform X. This contributed to a jump in other revenue within the Institutional Securities division, which more than doubled to $692 million from $242 million a year ago.
Market Impact
The rally in Morgan Stanley's stock comes amid a 45% surge in trading volumes, as investors rebalanced their portfolios, with notable activity in technology and industrial sectors.
