Morgan Stanley earnings: Why profits were up 47%

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Morgan Stanley beat earnings estimates as profits rose 47%.

Key points The financial services firm got a big boost from investment banking. The stock has beaten the S&P 500 over the past 10 years. Financial services behemoth Morgan Stanley reported strong second quarter earnings with profits rising 47%, pushing Morgan Stanley stock higher. The firm generated $15 billion in revenue, an 11% year-over-year increase, besting estimates by 5%. Net income surged 41% year-over-year to $3.1 billion, while earnings per share rose 47% to $1.82 per share.

But that is changing as Morgan Stanleyʻs investment banking revenue rose 51% in the second quarter, year-over-year, to $1.6 billion. Further, the Institutional Securities business, which includes investment banking and equity and fixed income trading, rose 25% to $7 billion in the quarter. Morgan Stanley also got a lift from its wealth and investment management businesses. Morgan Stanley is a leader in wealth management, which is its private banking, financial advisory, and brokerage arm.

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