Merrill Lynch Income Down, but Stock Leaps on Rebound Hopes

Merrill Lynch & Co. reported a 39% drop in first-quarter profit Tuesday, but the firm’s stock price rose sharply amid signs that the No. 1 brokerage firm is rebounding from a yearlong industry slump.

Merrill Lynch also announced a broad realignment of its management structure aimed at strengthening ties between the firm’s array of investment banking and financial market businesses. The new management groups are designed to enhance service to clients and to give senior regional managers a bigger say in companywide decisions.

In the three months ended March 31, Merrill earned $227.3 million, or $1.08 per share, down from a record $371.8 million, or $1.68 per share, in the year-earlier period. The per-share earnings were at the high end of analysts’ estimates, according to Zack’s Investment Research.

Merrill shares gained 87.5 cents to close at $44.25 on the New York Stock Exchange.