Morgan Stanley shares jump 6% after massive beat on fourth-quarter profit


James Gorman

David A. Grogan | CNBC

Morgan Stanley is set to report fourth-quarter earnings before the opening bell on Thursday.

Here’s what Wall Street expects:

Earnings: 99 cents a share, 24% higher than a year earlier, according to Refinitiv

Revenue: $9.72 billion, 14% higher than a year earlier

Wealth management: $4.39 billion, according to FactSet

Trading: Equities $1.93 billion, Fixed Income $933.5 million

Did Morgan Stanley’s bond traders match the performance of rivals – or get beaten by them?

In a quarter in which competitors from J.P. Morgan Chase to Goldman Sachs posted huge rebounds to fixed income trading revenue, it remains to be seen whether Morgan Stanley’s smaller operations held their own.

CEO James Gorman has tilted Morgan Stanley towards wealth management and overhauled its once-struggling bond trading division. But the trading and advisory operations are still a crucial part of the company’s business mix.

Last month, Morgan Stanley cut roughly 2% of its workforce due to an uncertain global economic outlook, a cull that hit technology and operations roles the hardest, people with knowledge of the matter said.

Morgan Stanley is the last of the six largest U.S. banks to report results.

Earlier this week, J.P. Morgan, Citigroup, and Bank of America posted profits that beat analysts’ expectations on surging bond-trading results. Results at Wells Fargo and Goldman Sachs were both marred by legal expenses tied to scandals: At Wells, legal charges were tied to its fake accounts issue, while Goldman neared a resolution to its 1MDB investigation.

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