Morgan Stanley Earnings Miss Forecasts

Morgan Stanley Dean Witter & Co., one of Wall Street’s premier investment banks, said profit rose 29% to $1.25 billion, or $1.09 a share, but the results missed analyst estimates of $1.17 a share. Morgan Stanley, which also owns the Discover credit card, had beaten analyst earnings forecasts in the previous 15 quarters. A slowdown in investment banking fees, coupled with a dramatic decline in trading revenue from this year’s second quarter, caused the downward surprise, the company said. Net revenue grew 18% to $6.29 billion. Trading revenue was up 43% to $1.63 billion from a year ago, but fell 35% from the previous quarter. Investment banking revenue slipped 3% to $1.15 billion. At the Discover credit card business, net income rose 10% to $222 million. Shares of Morgan Stanley fell $6.63, or 7%, to close at $89.31 on the New York Stock Exchange.

Guide to Our Staff: Need to reach Business section reporters or editors? A guide to the section’s staff can be found at: https://www.latimes.com/bizstaff.