The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Morgan Stanley beat expectations on revenues.
Compared to the prior-year quarter, revenue shrank significantly and earnings per share shrank to a loss.
Margins shrank across the board.
Morgan Stanley logged revenue of $5.71 billion. The 15 analysts polled by S&P Capital IQ expected to see revenue of $5.22 billion. Sales were 28% lower than the prior-year quarter's $7.81 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions.
Non-GAAP EPS came in at -$0.14. The 16 earnings estimates compiled by S&P Capital IQ averaged -$0.54 per share on the same basis. GAAP EPS were -$0.15 for Q4 versus $0.02 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Figures may be non-GAAP to maintain comparability with estimates.
For the quarter, gross margin was 85.0%, 460 basis points worse than the prior-year quarter. Operating margin was -8.0%, 5,160 basis points worse than the prior-year quarter. Net margin was -4.4%, 1,490 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $8.24 billion. On the bottom line, the average EPS estimate is $0.45.
Next year's average estimate for revenue is $32.41 billion. The average EPS estimate is $1.93.
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 1,547 members out of 1,939 rating the stock outperform, and 392 members rating it underperform. Among 510 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 411 give Morgan Stanley a green thumbs-up, and 99 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Morgan Stanley is outperform, with an average price target of $22.82.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.