Adjusted EPS for the third quarter added $0.01 to the bank’s unadjusted EPS, and excludes a $0.70 per share tax benefit, a $0.40 per share charge for compensation deferrals, a charge of $0.17 per share in fair value adjustments and $0.12 charge per share for legal expenses. Quarterly revenues exclude a positive debt valuation adjustment of $223 million, compared with a negative adjustment of $368 million in the year-ago quarter.
For the full year, the Morgan Stanley reported net revenues of $34.3 billion and EPS of $2.96, compared with revenues of $32.5 billion and EPS of $1.38 in 2013. The current year included $0.21 per share in net discrete tax benefits. Analysts were expecting EPS of $2.56 on revenues of $34.26 billion.
ALSO READ: The Bullish and Bearish Case for J.P. Morgan and Big Banks in 2015
Morgan Stanley’s Basel III common equity tier 1 ratio at the end of December was 14.2%, and its tier 1 capital ratio was about 15.9%. The bank’s tangible book value per common share at the end of the quarter was $29.63, based on approximately 2 billion shares outstanding.
The bank did not provide guidance in its earnings release. The consensus estimate for first-quarter adjusted EPS is $0.78 on revenues of $9.42 billion. For the full year, the consensus calls for EPS of $2.91 on revenues of $36.48 billion.
The bank’s CEO said:
We finished 2014 in substantially better shape than we entered the year. We delivered strong results across several of our businesses, although overall performance was affected by the choppy market conditions of the fourth quarter.
Fixed-income trading at Morgan Stanley suffered the same fate as at the other big banks. The bank’s trading desk revenue fell 14%. Investment banking revenue was also lower than a year ago by 6.6%. Given the abundance of initial public offerings that seems a bit odd.
Shares traded down about 3% in the premarket to $33.89. The current 52-week range is $28.31 to $39.19. Thomson Reuters had a consensus analyst price target of around $38.90 before the results were announced.
ALSO READ: Not Even Goldman Sachs Escapes Bank Earnings Drag
Take Charge of Your Retirement: Find the Right Financial Advisor For You in Minutes (Sponsor)
Retirement planning doesn’t have to feel overwhelming. The key is finding professional guidance—and we’ve made it easier than ever for you to connect with the right financial advisor for your unique needs.
Here’s how it works:
1️ Answer a Few Simple Questions
Tell us a bit about your goals and preferences—it only takes a few minutes!
2️ Get Your Top Advisor Matches
This tool matches you with qualified advisors who specialize in helping people like you achieve financial success.
3️ Choose Your Best Fit
Review their profiles, schedule an introductory meeting, and select the advisor who feels right for you.
Why wait? Start building the retirement you’ve always dreamed of. Click here to get started today!
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
