Does Lehman have its mojo back?

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Lehman kicked off the banking earnings release season by beating analyst estimates and posting a 27% profit gain for the second quarter. Lehman reported a record quarterly revenue on a 25% increase over last year and net income of $2.21 per share, which beat analyst estimates by 18% and last year by 31%.
Lehman’s revenue boost came mainly from capital markets with equities trading revenue increasing 94%, offsetting a 14% decline in fixed-income trading, dampened by weakness in mortgage backed securities caused by the subprime fallout.
Non-domestic revenue sources account for 48% of Lehman’s net revenue, which CEO Richard Fuld interprets as a sign of unprecedented strength in the bank’s global platform, which has been one of Lehman’s weaker areas in the past relative to other banks and had several outlets pushing for an acquisition earlier in the quarter.
The strong earnings report may indicate that Lehman has its mojo back (and we’re talking relative mojo here), as a month ago Breakingviews and other outlets pointed out Lehman’s recent drop-off (compared to its surges 3-5 years ago) relative to the gains of other banks during the current boom in the banking sector. Lehman’s quarterly net income gain is expected to beat competitors, as Morgan Stanley is expected to post earnings of $2.21/share (an increase of 8%), Bear Stearns $3.50/share (a slight drop) and Goldman $4.79/share (flat).
Lehman is still expected to pay TOP TIER analyst bonuses this year, and Lehman (NYSE: LEH) shares are up over 2.5% in morning trading at $77.65 but still 10% off its 52 week high of $86.18.
Lehman Posts Record Revenue [Wall Street Journal]

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