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Stock Market Today: Morgan Stanley Makes an Acquisition and Restaurant Brands Reports Growth

By Jim Crumly – Updated Apr 22, 2019 at 3:57PM

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Major benchmarks zigzagged in the absence of news on trade.

Stocks were indecisive Monday, with little news on trade or the economy to move markets. The Dow Jones Industrial Average (^DJI -1.63%) mostly drifted lower, but the S&P 500 (^GSPC -1.65%) seesawed between gains and losses.

Today's stock market

Index Percentage Change Point Change
Dow (0.21%) (53.22)
S&P 500 0.07% 1.92

Data source: Yahoo! Finance.

Energy shares moved up after dropping last week; the SPDR S&P Oil & Gas Exploration & Production ETF (XOP -2.69%) recovered 1.6%. Communication services was the weakest sector, with the Communication Services Select SPDR ETF (XLC -1.75%) off 1%. 

As for individual stocks, Morgan Stanley (MS -1.36%) is buying a firm that manages stock plans for up-and-coming companies, and Restaurant Brands International (QSR 0.69%) reported fourth-quarter results.

Check out the latest Restaurant Brands and Morgan Stanley earnings call transcripts.

Graph display on a city street.

Image source: Getty Images.

Morgan Stanley deals for future millionaires

Morgan Stanley is paying $900 million to buy Solium Capital, a Canadian company that manages employee stock equity plans, and shares of the bank slipped 1.5%. The all-cash deal represents a pricey 43% premium for Solium shares, which trade on the Toronto exchange. It's expected to close in the second quarter.

Morgan Stanley already has a business managing stock plans in its wealth management segment, but has been focused on large companies, with 320 corporate clients and 1.5 million participants, a quarter of which are in the Fortune 500. Solium serves a higher proportion of smaller clients, including rapidly growing companies like Shopify, Instacart, and Stripe. Morgan Stanley will pick up 3,000 stock plan clients and 1 million participants in the deal.

Last quarter was somewhat of a disappointment for Morgan Stanley investors, but on the conference call, the company said that it wanted to use its stock plan channel to generate new clients for the future, and it hinted it was open to acquisitions to do so. Today's deal brings in a younger, potentially well-to-do demographic, which Morgan Stanley hopes to convert to long-term wealth management clients.

Restaurant Brands reports growing sales

Restaurant Brands International reported sales growth thanks to new restaurant openings and comparable-sales gains across its portfolio, and shares rose 1.6%. The Canadian parent of Tim Hortons, Burger King, and Popeye's Louisiana Kitchen saw sales grow 6.8% to $8.19 billion, which was slightly better than analysts were anticipating. Earnings per share came in at $0.67, which was less than the $0.71 the company earned in Q4 last year, but $0.01 better than expectations.

Comparable sales, which were no surprise as they were released three weeks ago along with a dividend boost, were up 1.9% at Tim Hortons, 1.7% at Burger King, and 0.1% at Popeye's. The company increased its restaurant count by 5.5%, with the most growth coming from Popeye's at 7.3% and Burger King with 6.1% more locations.

Restaurant Brands is remodeling Tim Horton stores, expanding store count of the other two chains, and investing in adding delivery, ordering kiosks, and loyalty programs.

Jim Crumly owns shares of SHOP. The Motley Fool owns shares of and recommends SHOP. The Motley Fool has a disclosure policy.

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