Morgan Stanley and Goldman Sachs Expected to be In-Line with Expectations, Benstein Reports

Bernstein analyst Brad Hintz reported that fourth quarter results by Morgan Stanley (NYSE: MS) and Goldman Sachs (NYSE: GS) should be in-line with expectations.

Hintz reported that he sees positive banking results amid relatively tepid sales and trading and that the 2014 outlook remains strong. He writes that ECM is “booming,” U.S. M&A are showing signs of ramping up, and that DCM continues to perform. Bernstein noted that there is strength in the fourth quarter investment banking ECM underwriting. The analyst added that DCM performed well and sales and trading saw muted FICC risk taking. Hintz continued, noting that equity volumes of soft/ volatilities are down and that commodities are lagging.

The analyst commented that Goldman Sachs and Morgan Stanley are the most levered given the high market share, high margin M&A, and ECM. Bernstein cut Goldman Sach's fourth quarter EPS estimate from $4.40 to $4.17. Hintz lowered Morgan Stanley's EPS estimate from $0.50 to $0.46.

Goldman Sachs closed at $176.89 on Thursday and is currently trading up 0.71%. Morgan Stanley closed at $31.03 and is currently up 1.45%.