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Morgan Stanley Q1 Results Climb, Top Estimates

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Financial services giant Morgan Stanley (MS) reported Wednesday significantly higher earnings and revenues in its first quarter, with strong performance mainly in Sales & Trading and Investment Banking. Earnings per share as well as revenues topped market estimates.

In pre-market activity on the NYSE, Morgan Stanley shares were gaining 2.52 percent to $42.25.

James Gorman, Chairman and Chief Executive Officer, said, "We reported one of ourstrongest quarters in recent years. All our businesses performed well in improved market conditions. We are confident in our business model and the opportunities ahead, while recognizing that the environment remains uncertain."

In the first quarter, net income applicable to Morgan Stanley shareholders climbed 74 percent to $1.84 billion from last year's $1.06 billion. Earnings per share grew 82 percent to $1.00 from $0.55 in the same period a year ago.

On average, 13 analysts polled by Thomson Reuters expected earnings of $0.88 per share for the quarter. Analysts' estimates typically exclude special items.

Net revenues grew 25 percent to $9.75 billion from $7.79 billion a year ago. Analysts were looking for revenues of $9.29 billion.

In the quarter, revenues from Institutional Securities segment climbed 39 percent from last year to $5.15 billion, reflecting strength in sales and trading franchise and improved underwriting results. Investment Banking revenues climbed 40% despite weak advisory revenues on lower levels of completed M&A activity. Sales and Trading net revenues also improved from last year.

The company's Wealth Management revenues were boosted by 11 percent, with growth in asset management fee revenues reflecting market appreciation and positive flows.

Investment Management revenues were up 28 percent, benefited primarily by investment gains in certain private equity and real estate funds compared with losses in the prior year period.

Assets under management or supervision at March 31, 2017 were $421 billion.

Further, the company said its Board of Directors declared a $0.20 quarterly dividend per share, payable on May 15 to common shareholders of record on May 1.

by RTT Staff Writer

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