Morgan Stanley (MS) CEO Gorman Talks Earnings, Firm's Strengths with CNBC
NEW YORK (TheStreet) -- Morgan Stanley (MS) - Get Report reported better than expected 2016 second quarter earnings results before the market opened on Wednesday morning. Shares of the financial services company are up by 2.78% to $28.97 this morning.
Second quarter earnings came in at 75 cents per share on revenue of $8.9 billion. Wall Street was expecting Morgan Stanley to post earnings of 59 cents per share on revenue of $8.3 billion for the quarter.
Morgan Stanley CEO James Gorman appeared on CNBC's "Squawk on the Street" to discuss the company's latest financial results and what investors can expect going forward.
"We're making progress, the business did well. All of our businesses I think, sequentially were up, and yea it was an 8.3% ROE decent for sure, very solid. I'm much more focused on the next couple of year and the trajectory we're on," Gorman told CNBC anchor David Faber.
Faber pointed out that on the company's earnings call Gorman talked about Morgan Stanley "emerging from the pack in terms of the global banking industry," and questioned the CEO on the means to continue the company's strengthens.
"If you look at the core businesses that have been, supposed to be doing well, they're doing great. Equities, number one franchise in the world. Investment banking, top couple of franchising in the world with the IPO market and the M&A et cetera," Gorman added.
Gorman went on to discuss Morgan Stanley's acquisition with Smith Barney, calling it a "phenomenal gem" and noting that it created a business that has $2 trillion of assets under management and $15 billion in revenue.
Morgan Stanley has created and turned around fixed income as a major focus for the firm and the CEO pointed out that the company is seeing some evidence the business can perform the way the company wants it to.
Separately, TheStreet Ratings has set a "hold" rating and a score of C+ on Morgan Stanley stock. The primary factors that have impacted the rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks.
The company's strengths can be seen in multiple areas, such as its attractive valuation levels, good cash flow from operations and notable return on equity. However, as a counter to these strengths, TheStreet Ratings also finds weaknesses including unimpressive growth in net income, poor profit margins and a generally disappointing performance in the stock itself.
TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
You can view the full analysis from the report here: MS