This week in earnings: Goldman Sachs rocks estimates, Discover Financial sinks

Investing.com — Here is your Pro Recap of the most important earnings reports you may have missed this week: Morgan Stanley , Charles Schwab , Goldman Sachs, and Discover Financial Services.

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Goldman Sachs beats Q4 earnings, revenue jumps

Goldman Sachs Group (NYSE:GS) reported its Q4/23 results, with EPS of $5.48 coming in better than the consensus of $3.80.

Revenue grew 7% year-over-year to $11.32B, beating the consensus estimate of $10.83B. The increase reflected higher net revenues in Asset & Wealth Management and Platform Solutions, partially offset by lower net revenues in Global Banking & Markets.

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Morgan Stanley tops revenue estimates, but profit takes hit from $535 million impact

Morgan Stanley (NYSE:MS) shares dropped more than 4% on Tuesday after the company reported its Q4 results, topping revenue expectations, as reported in real-time on InvestingPro.

Quarterly revenue came in at $12.9 billion, compared to the consensus estimate of $12.79B. Meanwhile, EPS was $0.85, missing the consensus estimate of $1.08. Morgan Stanley's Q4 pre-tax income included $535 million of charges, with $286M related to an FDIC special assessment and a $249M legal charge related to a "specific matter".

Following the report, two Wall Street firms downgraded the bank. JPMorgan cut Morgan Stanley’s rating from Overweight to Neutral with a price target of $87.00 (from $94.00). Meanwhile, Keefe, Bruyette & Woods downgraded the company from Outperform to Market Perform with a price target of $91.00 (from $102.00).

Charles Schwab reports drop in Q4 profit

Charles Schwab's (NYSE:SCHW) profit in Q4 dropped by 47%, impacted by higher interest expenses on client deposits and debt, despite an increase in asset management fees.

The aggressive interest rate hikes by the U.S. Federal Reserve have adversely affected financial firms like Schwab, which are dependent on client deposits and uninvested cash for bond purchases and loans.

For Q4 Charles Schwab reported EPS of $0.68, compared to the consensus estimate of $0.64. Revenue came in at $4.46B, missing the consensus estimate of $4.53B.

Discover Financial Services drops on Q4 Profit Miss

Discover Financial Services (NYSE:DFS) shares saw a drop of more than 10% on Thursday following the company's report of a substantial decrease in its Q4 net income. This decline was partly attributed to increased compliance-related expenses.

The Illinois-based company recorded a net income of $388 million for the quarter, marking a 62% fall from the same period the previous year. This equated to diluted EPS of $1.54, notably lower than the consensus estimate of $2.52.

Meanwhile, revenue for the quarter came in at $4.2B, above the consensus estimate of $4.11B.

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