Two leaders in investment banking released their earnings today before the U.S. market session opened. In pre-market trading, Goldman Sachs' stock is slowly sliding down by about 1.5%, while Morgan Stanley initially rises over 1% but loses gains over time.
Morgan Stanley
The company exceeded investor expectations both in terms of EPS (2.68 vs expected 2.41) and revenues at 17.9 billion dollars compared to the expected 17.7 billion dollars. Net income amounted to 4.4 billion dollars.
This indicates an increase in revenues compared to previous quarters and a slight decrease in profit. The trading and capital management segments performed the best. The board approved a quarterly dividend of $1 per share (unchanged from the last two payments).
MS.US (D1)
Source: xStation5
Goldman Sachs
The company boasts a significant positive surprise in terms of profits. Earnings per share were $14 compared to expectations of $11.6, a quarter-over-quarter increase of about 15%. Revenues were disappointing, amounting to 13.45 billion compared to expectations of 14.5 billion dollars, a decrease of about 10% compared to the previous quarter.
The biggest positive surprises were revenues from asset management and advisory services. Both segments registered a year-over-year growth of 25%.
What is concerning is the increase in operating costs, which rose by 18% year-over-year in Q4.
The board raised the dividend from $4 to $4.5 per share.
GS.US (D1)
Source: xStation5
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