NEW YORK (CNNfn) - Brokerage houses continued to beat Wall Street estimates Tuesday as Goldman Sachs Group Inc. and National Discount Brokers posted record results for their most recent quarters.|
Goldman Sachs, which said it had gains across its many business segments, also announced plans to repurchase up to 15 million shares, or about 3 percent of its shares outstanding.
Goldman (GS: Research, Estimates), the leading merger and acquisition investment bank, posted net income of $887 million, or $1.76 a diluted share, for its fiscal first quarter ended Feb. 25. Analysts surveyed by earnings tracker First Call had forecast Goldman to earn $1.48 a share for the quarter.
In the year-earlier quarter, the firm's pro forma earnings were $532 million, or $1.12 a share, before its initial public offering. The pro forma results assume that the IPO took place before the quarter for purposes of comparison.
Revenue rose to $8 billion from $5.9 billion. Revenue net of interest expense rose to $4.5 billion from $3 billion.
The company saw revenue from underwriting rise 72 percent from the year ago to $653 million, leading to an overall 37 percent gain in investment banking revenue to $1.2 billion. Equities saw revenue climbed 89 percent to a record $858 million.
NDB beats raised forecasts
National Discount Brokers (NDB: Research, Estimates) more than doubled its year-earlier profit. The company had earnings of $21.5 million, or $1.16 a diluted share, for its fiscal third quarter ended Feb. 29, excluding a charge of $2.25 million, or 6 cents a share, related to the closing of certain locations in New York.
The firm's per-share earnings were 16 cents above the First Call estimate, which had been raised when the company issued a statement at the end of last month that it would make between $1.05 and 95 cents in the quarter.
In the year-earlier quarter, the broker posted earnings from continuing operations of $7.8 million, or 55 cents a share. The company also earned $422,000, or 3 cents a share, from discontinued operations in the earlier period.
Revenue rose 121 percent in the quarter to $141.2 million from $63.9 million a year earlier.
For the first nine months of the year, the firm's earnings from continuing operations rose 109 percent to $24 million, or $1.41 a diluted share, from $11.5 million, or 82 cents a share, in the year-earlier period. Revenue rose to $265.1 million from $141 million.
The strong results follow those of Lehman Brothers, which easily beat estimates for the quarter. Morgan Stanley Dean Witter's earnings report is due Thursday.
Despite the good news, shares of Goldman and NDB were both lower in early morning trading Tuesday. Goldman shares lost 3-3/16 to 110-1/8 shortly after the opening bell Tuesday, while NDB shares fell 1-7/8 to 44-1/4.