Analyst Note| Michael Wong, CFA, CPA |
As we expected, Morgan Stanley’s recent streak of strong revenue and earnings was sustained in the third quarter, and the company achieved an annualized return on tangible equity of about 20%. Net revenue of $14.8 billion was 26% higher than a year ago and basically equal to the second quarter. Record investment banking and growth in asset management revenue and net interest income offset a decline in trading revenue. We don’t anticipate making a material change to our $85 fair value estimate for narrow-moat Morgan Stanley.