Morgan Stanley MS, -4.48% fell 2.6% in premarket trades Friday after the investment bank missed Wall Street’s targets for earnings and revenue amid a drop in deal activity. Morgan Stanley said its third-quarter net income fell to $2.49 billion, or $1.47 per share, from net income of $3.7 billion, or $1.98 per share in the year-ago quarter. Third-quarter revenue dropped to $12.99 billion from $14.75 billion. Wall Street analysts were looking for earnings of $1.52 a share and revenue of $13.29 billion, according to FactSet data. “Firm performance was resilient and balanced in an uncertain and difficult environment, delivering a 15% return on tangible common equity,” said CEO James Gorman. “Wealth Management added an additional $65 billion in net new assets and produced a pre-tax margin of 28%, excluding integration-related expenses, demonstrating scale and stability despite declining asset values.” Morgan Stanley shares are down 19.2% in 2022, compared to a drop of 23% by the S&P 500 SPX, -1.69% and a 17.3% loss by the Dow Jones Industrial Average DJIA, -0.87%.
