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Morgan Stanley  (NYSE:MS) Net Income: $7,134 Mil (TTM As of Sep. 2017)

Net Income is the net profit that a company earns after deducting all costs and losses including cost of goods, SGA, DDA, interest expenses, non-recurring items and tax. Morgan Stanley's net income for the three months ended in Sep. 2017 was $1,781 Mil. Its net income for the trailing twelve months (TTM) ended in Sep. 2017 was $7,134 Mil.

Net Income is linked to the most popular Earnings per Share (Diluted) number. Morgan Stanley's Earnings per Share (Diluted) for the three months ended in Sep. 2017 was $0.93.


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

* Premium members only.

Morgan Stanley Annual Data

Nov08 Dec09 Dec10 Dec11 Dec12 Dec13 Dec14 Dec15 Dec16 Dec17
Net Income Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 2,932.00 3,467.00 6,127.00 5,979.00 6,154.00

Morgan Stanley Quarterly Data

Dec12 Mar13 Jun13 Sep13 Dec13 Mar14 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Sep17
Net Income Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 1,597.00 1,666.00 1,930.00 1,757.00 1,781.00

Calculation

Net Income is the net profit that a company earns after deducting all costs and losses including cost of goods, SGA, DDA, interest expenses, non-recurring items and tax.

Net Income
= Revenue - Cost of Goods Sold - Selling, General, & Admin. Expense - Research & Development - Depreciation, Depletion and Amortization - Interest Expense - Non-Recurring Items (NRI) - Tax Expense + Others
= - Depreciation, Depletion and Amortization - Interest Expense - Non-Recurring Items (NRI) - Tax Expense + Others
= Operating Income - Interest Expense - Non-Recurring Items (NRI) - Tax Expense + Others
= Pre-Tax Income - Tax Expense + Others

Morgan Stanley's Net Income for the fiscal year that ended in Dec. 2016 is calculated as

Net Income(A: Dec. 2016 )
= Pre-Tax Income + Tax Provision + Other Income (Expense) + Net Income (Discontinued Operations)
=8848+-2726+0+1
=6,123

Morgan Stanley's Net Income for the quarter that ended in Sep. 2017 is calculated as

Net Income(Q: Sep. 2017 )
= Pre-Tax Income + Tax Provision + Other Income (Expense) + Net Income (Discontinued Operations)
=2482+-697+0+6
=1,791

Net Income for the trailing twelve months (TTM) ended in Sep. 2017 was 1666 (Dec. 2016 ) + 1930 (Mar. 2017 ) + 1757 (Jun. 2017 ) + 1781 (Sep. 2017 ) = $7,134 Mil.

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.


Explanation

Net income is the most widely cited number in reporting a company's profitability. It is linked to the most popular earnings-per-share (EPS) number through:

Morgan Stanley's Earnings per Share (Diluted) (EPS) for the quarter that ended in Sep. 2017 is calculated as

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Although Net Income and Earnings-per-Share (EPS) are the most widely used parameter in measuring a company's profitability and valuation, it is the least reliable. The reason is that reported earnings can be manipulated easily by adjusting any numbers such as Depreciation, Depletion and Amotorization and non-recurring items.

EPS is most useful for companies that have:

A predictable business
Consistent accounting methods
And few restructurings

The dividend paid to preferred stocks needs to be subtracted from the total net income in the calculation of EPS because common stock holders are not entitled to that part of the net income.


Be Aware

Warren Buffett looks for consistency and upward long term trend. Because of share repurchase it is possible for net earnings trend to differ from EPS trend. He preferred net income over EPS. The companies with durable competitive advantage companies report higher % net earnings to total revenues.

Important: If a company is showing net earnings history greater than 20% on total revenues, it is probably benefiting from a long term competitive advantage.

If net earnings is less than 10%, likely to be in a highly competitive business.


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