New York, Jan 16, 2026, 12:55 EST — Regular session
Morgan Stanley shares edged up roughly 0.6%, hitting $192.40 by midday Friday. The stock traded between $190.39 and $192.69 after kicking off at $190.76.
The gain follows Thursday’s earnings, when the Wall Street bank topped profit forecasts as investment banking revenue surged 47% to $2.41 billion, fueled by debt underwriting and a rebound in M&A activity. The bank posted $2.68 per share for the quarter, outpacing the $2.44 consensus from LSEG. CFO Sharon Yeshaya told Reuters she’s seeing “an accelerating pipeline in M&A and IPOs.” CEO Ted Pick said on the earnings call the bank plans to “continue to be patient” on acquisitions amid what he called a “complicated” environment. 1
Morgan Stanley offers a sharp lens on U.S. dealmaking and market moves thanks to its institutional securities arm, which anchors underwriting and advisory work. Investors are betting that the pickup in issuance seen last year will extend into 2026. They’re also counting on wealth inflows and trading to support the market when volatility kicks in.
Morgan Stanley’s latest SEC filing shows fourth-quarter net revenue hitting $17.89 billion, with net income at $4.40 billion. Its return on tangible common equity (ROTCE) came in at 21.8%, excluding goodwill and intangibles. Wealth Management revenue climbed to $8.43 billion as the firm added $122.3 billion in net new assets during the quarter. The bank’s standardized common equity tier 1 (CET1) capital ratio was 15.0% at year-end. Morgan Stanley repurchased $1.5 billion of shares and announced a $1.00 quarterly dividend, payable Feb. 13 to shareholders of record Jan. 30. 2
Bank execs are already eyeing a busier 2026 after underwriting and advisory fees picked up last year. According to Dealogic, global investment banking revenue topped $100 billion in 2025. Macrae Sykes, portfolio manager at Gabelli Funds, said: “I expect 2026 to be a very strong year of IPO issuance and announced M&A.” For clarity, IPOs are stock market debuts. 3
A Reuters Breakingviews column pointed out that Morgan Stanley and Goldman Sachs are now trading at price-to-book multiples above their pre-crisis highs — roughly 3.1 times and 2.7 times projected book value, respectively. Yet, both banks are generating lower returns on equity compared to 2007, a gap that could weigh on these expensive stocks if growth slows. 4
The next phase hinges on markets playing along. A drop in equity prices or a sudden dip in volatility could prompt companies to put offerings on hold and sponsors to pause buyouts, which would blunt fee growth.
Traders are zeroing in on the Federal Reserve’s policy meeting set for Jan. 27-28, a key moment for rate forecasts that directly influence issuance and risk appetite. Morgan Stanley investors will be keen to see if new mandates lead to announced deals and follow-on offerings early in Q1. 5
