U.S. earnings season has kicked with a sleuth of banks reporting. Among them was Morgan Stanley, founded in 1935 and one of the largest investment banks in the world.
Learn more about Morgan Stanley's fiscal fourth-quarter performance and what analysts are forecasting for the stock.
|Morgan Stanley Inc
|Symbol for Invest.MT5 Account:
|Date of Idea:
|16 January 2024
|1 – 6 months
|Position Size for Invest.MT5 Account:
- The Invest.MT5 account allows you to buy real stocks and shares from 15 of the largest stock exchanges in the world.
All trading is high risk and you can lose more than you risk on a trade. Never invest more than you can afford to lose, as some trades will lose and some trades will win. Start small to understand your own risk tolerance levels or practice on a demo account first to build your knowledge before investing.
Morgan Stanley Fiscal Q4 2023 Performance
Here are some of the key highlights from the latest fiscal fourth-quarter earnings report from Morgan Stanley:
- Earnings per share of 85 cents versus $1.01 expected
- Revenue of $12.90 billion vs $12.74 billion
- Investment banking revenue up 5% from the same time last year
- Net income of $1.52 billion, down from $2.24 billion the same time last year
Morgan Stanley posted revenue that beat analyst expectations with its investment banking unit leading the way higher due to a 25% increase in its fixed income underwriting revenue. Investment grade issuances were higher than usual as the tail end of last year saw an increase in secondary share sales and merger announcements.
On most other metrics Morgan Stanley posted disappointing figures. Earnings per share and net income were lower than analyst expectations and down from the prior year. The bank was hit by two one-off regulatory charges: a $286 million charge for the Federal Deposit Insurance Corporation special assessment and a $249 million legal settlement for a criminal and civil investigation for how it handled large stock trades for its customers.
Chief Financial Officer Sharon Yeshaya stated the bank is not changing its guidance to 2024 and is working on a premise of a soft landing. The slowdown in its wealth management division may concern investors. Much of Morgan Stanley's growth has been attributed to former CEO James Gorman's focus on reaching $10 trillion in assets under management.
However, there has a been slowdown in new client assets with net revenue figures from the division flat at $6.65 billion when compared to the same time last year. It's wise to keep track of how Morgan Stanley's wealth management division performs in a year in which its client may be more cautious with elections in the U.S. and UK, which could result in lower revenue. This uncertainty is one reason there is a higher number of analysts who have a hold rating on the stock.
Morgan Stanley Stock Forecast – What do the Analysts Say?
According to analysts polled by TipRanks for a Morgan Stanley stock forecast in the past 3 months, there are currently 11 buy, 12 hold and 0 sell ratings on the stock. The highest price level for a Morgan Stanley stock forecast is $116.00 with the lowest price target at $79.15.
The average price target for a Morgan Stanley stock forecast is $94.91.
An Example Trading Idea for the Morgan Stanley Stock Price
An example trading idea for the Morgan Stanley share price could be as follows:
- Buy the stock on a break above the post-earnings high at $88.50 to allow for volatility.
- Target just below the highest analyst price target of $116.00.
- Keep your risk small at a maximum of 5% of your total account.
- Time Line = 1 – 6 months
- If you buy 10 Morgan Stanley shares:
- If target is reached = $275.00 potential profit [($116.00 – $88.50) * 10 shares].
Remember that markets go up and down and it is unlikely the share price will move up in a straight line. In fact, it may even go much further down before it rises, especially considering the uncertainty around its wealth management division and the impact of U.S. and UK elections on investors.
Be sure to exercise good risk management and always know how much you could potentially lose on a trade and the risks involved, as well as the costs.
With the Admirals Invest.MT5 account you can buy and sell US stocks with a commission from $0.02 per share. This means buying 10 shares in Morgan Stanley stock would result in a commission of $0.20 ($0.02 * 10 shares) for executing a per-side transaction.
There is a low minimum transaction fee of $1. So, the example trading idea above would result in a commission of just $1 overall!
How to Buy Morgan Stanley Stock in 4 Steps
With Admirals, you can buy shares in companies like Morgan Stanley with a low commission of just $0.02 per share and a low minimum commission of just $1 on US stocks.
- Open an account with Admirals to access the dashboard.
- Click on Trade on one of your live or demo accounts to open the web platform.
- Search for your stock in the search window at the top right to view the live price chart.
- Click Create New Order from the bottom of the screen to open the trading ticket.
Click on the banner below to trade Morgan Stanley stock today ▼▼▼
Do You See the Morgan Stanley Stock Price Moving Differently?
Remember that all analytics and trading ideas are based on the personal view and experience of the author.
If you believe there is a higher chance Morgan Stanley share price will move lower, then you can also trade short from a CFD (Contracts for Difference) trading account which Admirals also provide.
This means you can trade long and short to potentially profit from rising and falling stock prices.
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