Curtiss-Wright: Morgan Stanley Reiterates Overweight Rating with $550 PT

Curtiss-Wright: Morgan Stanley Reiterates Overweight Rating with $550 PT

In a recent financial update, Morgan Stanley reiterated its "overweight" rating for Curtiss-Wright, setting a target price of $550 per share. This rating comes amidst a period of strong earnings for the investment bank itself, which reported robust second-quarter results despite some challenges in its investment banking division.

Morgan Stanley's second-quarter earnings exceeded Wall Street expectations, with net revenue reaching $16.8 billion, up nearly 12% from the previous year. Net income rose to $3.5 billion, or $2.13 per share, compared to $3.1 billion, or $1.82 per share, in the same period last year [1].

The bank's institutional securities unit generated $7.6 billion in revenue, driven by a 23% jump in equities trading and a 9% rise in fixed-income revenues. However, investment banking revenues fell 5%, as a drop in merger and acquisition advisory fees offset gains from equity underwriting, including high-profile IPOs such as fintech firm Chime and Hinge Health. Wealth management revenue rose 14% year-on-year to $7.8 billion, benefiting from increased client activity and higher asset management fees [1].

Despite the strong overall performance, investors reacted negatively to a sharp rise in provisions for credit losses, which increased to $196 million from $76 million a year ago. This, coupled with continued underperformance in investment banking relative to peers, led to a drop in shares [1].

Looking ahead, Morgan Stanley expressed optimism about a recovery in capital markets activity, noting increased client engagement in the latter half of the quarter. The bank also announced a 33% increase in its quarterly dividend to $1.00 per share and reiterated its commitment to maintaining flexibility in capital deployment [1].

At the time of the report, shares in Morgan Stanley were down 3.14% in New York, trading at $137.15 [1].

References:
[1] https://www.sharecast.com/news/international-companies/morgan-stanley-beats-q2-forecasts-investment-banking-performance-drags--20323222.html