Morgan Stanley (MS, Financial) just delivered a powerhouse performance in the third quarter, with profits surging 32% year-over-year to $3.2 billion, or $1.88 per share. Beating Wall Street expectations, this growth was fueled by robust activity in its investment banking division, where fixed-income underwriting revenues soared 56%. The firm pulled in $15.4 billion in total revenue, demonstrating the strength of its diversified business model. Additionally, Morgan Stanley's pre-tax margin increased to 27%, up from 24% a year ago, reflecting sharp execution and disciplined cost management.
CEO Ted Pick, who took the helm in January, emphasized the firm's ability to balance growth across its segments. While investment banking remains a key driver, Morgan Stanley's wealth management and investment management divisions continue to shine. Together, these segments manage over $7.5 trillion in client assets—nearly $6 trillion from wealth management alone—providing consistent revenue streams and reinforcing the firm's long-term stability. Morgan Stanley's shift toward steady, fee-based businesses is clearly paying off in terms of both stability and profitability.
Beyond the strong earnings, Morgan Stanley announced shareholder-friendly moves, including repurchasing $0.8 billion in shares and declaring a quarterly dividend of $0.925 per share. These actions signal confidence in its growth trajectory. Shares rose 3.6% in premarket trading, pushing the stock's year-to-date gains to 20%. With Ted Pick at the helm, Morgan Stanley is setting a new standard for industry leadership, leveraging its diverse strengths to drive future growth and deliver value to shareholders.
