Will the Morgan Stanley Comeback Stall In 2013?
With shares of Morgan Stanley (NYSE:MS) trading at around $20.19, is MS an OUTPERFORM, WAIT AND SEE or STAY AWAY? Let’s analyze the stock with the relevant sections of our CHEAT SHEET investing framework:
C = Catalyst for the Stock’s Movement
Amazingly, there hasn’t been much news for Morgan Stanley recently. Therefore, we can focus on the basics. Morgan Stanley is currently in this midst of a valiant comeback. Much of this has had to do with the sector overall. Policies and lax regulation have been big boons for banks. The Federal Reserve and European Central Bank have been major players as well as the biggest catalysts.
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In 2013, we will likely see only high-quality banks and investment brokerages continue to perform exceptionally well. Others will begin to slow. Morgan Stanley isn’t a leader in this arena. More importantly, margins and ROE are in negative territory. However, despite those negatives and Morgan Stanley not being best of breed, there are several positives to consider. These positives include an operating cash flow of $18.57 billion, a Forward P/E of 10.15, a strong balance sheet, and 12 Buy recommendations vs. 3 Sell recommendations by analysts.
Let’s take a look at some more important numbers for Morgan Stanley.