NEW YORK (AP) _ Morgan Stanley Dean Witter & Co., the nation’s second-largest retail broker, reported earnings of $1.54 billion for its first fiscal quarter, well above analysts’ expectations.
Morgan Stanley’s net income, which translates to $1.34 a share, compared with $1.04 billion, or 88 cents a share, a year earlier. Analysts surveyed by First Call/Thomson Financial had estimated that the New York-based securities firm and investment bank would earn $1.06 a share in the quarter, which ended Feb. 29.
Revenue was $7.41 billion, up 39 percent from $5.34 billion a year earlier.
Despite the strong showing, shares in morning trading fell $1.76 9/16, or nearly 2 percent, to $88.37 1/2 on the New York Stock Exchange.
Morgan Stanley is second only to Merrill Lynch in the retail brokerage business in the United States. It was the No. 1 stock underwriter in the first quarter.
Morgan Stanley, on the strength of the firm’s Internet analyst team headed by Mary Meeker, has emerged as one of the busiest underwriters of extremely lucrative Web-based initial public stock offerings.
Net income from the firm’s securities unit, which includes investment banking, rose more than 50 percent to $1.24 billion from $806 million, Morgan Stanley said.
Net income in its credit services unit, which includes the Discover Card business, was $142 million in the first quarter, up nearly 15 percent from the year-earlier total of $124 million.