Morgan Stanley (NYSE:MS) Quarterly Earnings Preview
Summary
Morgan Stanley (NYSE:MS) is expected to report Q2 2025 EPS of $1.93 and revenue of $16.04 billion, driven by strong trading activities and a 9.8% increase in net interest income. Despite positive trends, challenges include a decline in investment banking income. The stock has shown resilience, appreciating 36% in 2024, leading to an upgrade to 'buy'.
Morgan Stanley (NYSE:MS) Q2 2025 Earnings Preview: Strong Trading and NII Expected
Morgan Stanley (NYSE:MS) is set to release its second-quarter 2025 earnings on July 16, 2025, before market open. Analysts are closely watching, with consensus estimates projecting earnings per share (EPS) of $1.93 and revenue of approximately $16.04 billion.
Key Drivers for Q2 2025 Performance
The anticipated increase in Morgan Stanley's second-quarter earnings is primarily driven by robust trading activities and a significant rise in net interest income (NII). Market volatility is expected to have fueled a surge in trading revenues, with equity trading potentially seeing a 14.8% year-over-year increase. Furthermore, net interest income is projected to grow by 9.8% year-over-year, supported by stable interest rates and healthy loan growth.
Challenges and Analyst Revisions
Despite these positive trends, Morgan Stanley may face headwinds from a decline in investment banking income and underwriting fees. This comes even as the broader IPO market shows signs of strengthening.
For the first quarter, Morgan Stanley reported strong results, buoyed by solid investment banking and trading performance. However, for the upcoming second quarter, while the Zacks Consensus Estimate suggests revenues could reach $15.92 billion (a 6% year-over-year growth), there has been a slight downward revision of 0.7% in the consensus EPS estimate over the past 30 days, indicating a cautious reassessment by analysts.
Stock Performance and Outlook
Morgan Stanley's stock has demonstrated resilience, recovering from previous market turbulence and achieving an all-time high with a 36% appreciation in 2024. The company's favorable market conditions have led to an upgrade in its rating from 'hold' to 'buy' by some analysts. The upcoming earnings announcement and subsequent management conference call are expected to provide further clarity on the company's outlook, especially in light of broader economic factors and potential policy impacts.
Consensus Estimates Summary
- Q2 2025 EPS Estimate: $1.93
- Q2 2025 Revenue Estimate: $16.04 billion
- Net Interest Income (NII) Growth: +9.8% YoY
- Equity Trading Growth: +14.8% YoY