uploads///dollar _

Morgan Stanley Fell More than 5%: What Went Wrong in Q4?

By

Jan. 17 2019, Updated 12:00 p.m. ET

Morgan Stanley

Morgan Stanley (MS) released its fourth-quarter results early on January 17. The bank missed analysts’ consensus estimates for its earnings and revenues. The adjusted earnings miss resulted in a sell-off in Morgan Stanley stock. At 10:48 AM EST, Morgan Stanley was trading with 5.6% day losses. At the same time, JPMorgan Chase (JPM), Bank of America (BAC), and Goldman Sachs (GS) fell 0.5%, 0.4%, and 1.2%, respectively. The S&P 500 Index and the NASDAQ Composite Index (VTI) were trading on a mixed note without any major change for the day.

Article continues below advertisement

Key highlights

In the fourth quarter, Morgan Stanley’s adjusted earnings fell 4.8% YoY (year-over-year) to $0.80 per share—lower than analysts’ consensus estimate of $0.89.

Morgan Stanley’s adjusted revenues in the last quarter fell 10.0% YoY to $8.54 billion—much lower than analysts’ estimates of $9.29 billion. The bank blamed high global market volatility, weakness in credit and rates products, and a decline in investment banking and fixed-income revenues for hurting its fourth-quarter results.

While trying to reassure investors, Morgan Stanley CEO James Gorman said that “2018 was a great year that finished on a disappointing note.” He also said, “We do not believe the fourth quarter is the new normal.”

Morgan Stanley’s weak results made broader market investors worried. Unlike Morgan Stanley, Bank of America and Goldman Sachs reported solid fourth-quarter results on January 16.

Advertisement

More From Market Realist

  • SemiLEDS logo over LED lighting
    Company & Industry Overviews
    There's Still Time to Get in on SemiLEDS (LEDS) Stock
  • Trader on the NYSE
    Company & Industry Overviews
    What Are the Most Expensive Stocks Ever?
  • Michelob Ultra beer
    Company & Industry Overviews
    AB InBev Is the Top Beer Brand Worldwide—Is It a Monopoly?
  • Businesswoman looking out a window
    Company & Industry Overviews
    Shifting Focus: Three Women Investing Funds in 2021
  • CONNECT with Market Realist
  • Link to Facebook
  • Link to Twitter
  • Link to Instagram
  • Link to Email Subscribe
Market Realist Logo
Do Not Sell My Personal Information

© Copyright 2021 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.