January 4, 2024
Top 10 Stock Morgan Stanley Sell Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Morgan Stanley – Top 10 Stock in Dow Jones U.S. Investment Services Index
Morgan Stanley is listed as a top 10 stock on January 04, 2024 in the market index D.J. US Investing because of its high performance in at least one of the Obermatt investment strategies. Only the Obermatt Value Rank exhibits above-average performance, which means that the stock is seen as critical by the professional community and other financial facts are below average, conveying mixed investment signals. Based on the Obermatt 360° View of 6 (6% performer), Obermatt issues an overall sell recommendation for Morgan Stanley on January 04, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Investment Banking & Brokerage |
| Index | Dividends USA, Employee Health US, D.J. US Investing, S&P 500 |
| Size class | XX-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View Morgan Stanley Sell
| 360 METRICS | January 4, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 71 |
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| GROWTH | ||||||||
| GROWTH | 25 |
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| SAFETY | ||||||||
| SAFETY | 23 |
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| SENTIMENT | ||||||||
| SENTIMENT | 25 |
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| 360° VIEW | ||||||||
| 360° VIEW | 6 |
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ANALYSIS: With an Obermatt 360° View of 6 (better than 6% compared with alternatives), overall professional sentiment and financial characteristics for the stock Morgan Stanley are critical, mostly below average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for Morgan Stanley. Only the consolidated Value Rank has an attractive rank of 71, which means that the share price of Morgan Stanley is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is lower than for 71% of alternative stocks in the same industry. All other consolidated ranks are below average. The consolidated Growth Rank has a low rank of 25, which means that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. The consolidated Safety Rank has a riskier rank of 23, meaning the company has a riskier financing structure than 77% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, professionals are more pessimistic about the stock than for 75% of alternative investment opportunities, reflected in the consolidated Sentiment Rank of 25. ...read more
RECOMMENDATION: With a consolidated 360° View of 6, Morgan Stanley is worse than 94% of all alternative stock investment opportunities based on the Obermatt Method. This means that Morgan Stanley shares are on the riskier side for investors. Only one of the consolidated Obermatt Ranks exhibits above-average performance, namely the Value Rank at a level of 71. All other ranks are below average, so proceed with caution. The company has below-average growth expectations (Growth Rank of 25), a riskier financing structure than the competition (Safety Rank of 23), and the market sentiment in the professional investor community ranking at (Sentiment Rank of 25) is negative. This combination is sensitive to a crisis, because high debt levels (low safety) require growth to finance the debt burden. It’s no wonder that the investor community indicators are skeptical (low sentiment). Good value is sometimes an indication that the company's future is challenging. The below-par growth performance may be the reason for this assessment. We recommend evaluating whether the future of Morgan Stanley is as challenging as the low price of the stock suggests. Since the professional community is pessimistic, you might need to worry about the future of Morgan Stanley. Only invest if you have solid reasons to believe that the low growth is temporary and the current market sentiment is an overreaction, possibly due to reputational issues in the past. ...read more
Sentiment Strategy: Professional Market Sentiment for Morgan Stanley only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 25 (better than 25% compared with alternatives), overall professional sentiment and engagement for the stock Morgan Stanley is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with three out of four metrics below average for Morgan Stanley. Analyst Opinions are at a rank of 53 (better than 53% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. This is a good sign, were it not for Analyst Opinions Change with a low rank of 31, which means that currently, stock research experts are changing their opinions for the worse. In other words, they are getting more critical of a stock investment in Morgan Stanley. The Professional Investors rank is also low at 25, meaning that professional investors hold less stock in this company than in 75% of alternative investment opportunities. Pros tend to invest in other companies. Even worse, Market Pulse has a low rank of 34, which means that the current professional news and professional social networks are critical of this company (more negative news than for 66% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 25 (less encouraging than 75% compared with investment alternatives), Morgan Stanley has a reputation among professional investors that is below that of its competitors. There are several negative sentiment signals, with only the Analyst Opinions Rank above average. This could be a stock with a long reputation for being positive but where things are worsening. Most analysts may not see it yet, but some have, and the professionals are already quite pessimistic. Proceed with caution when investing in this stock. ...read more
Value Strategy: Morgan Stanley Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 71 (better than 71% compared with alternatives), Morgan Stanley shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, where three out of four indicators are above average for Morgan Stanley. Price-to-Sales (P/S) is 50 which means that the stock price compared with what market professionals expect for future sales is lower than for 50% of comparable companies, indicating a good value for Morgan Stanley's revenue size. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 71. Finally, compared with other companies in the same industry, dividend yields of Morgan Stanley are expected to be higher than for 79% of all competitors (a Dividend Yield rank of 79). The only low rank is for expected profits with a Price-to-Profit Rank of 48, indicating that the market expects the company's profit to be low despite a high dividend. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 71, is a buy recommendation based on Morgan Stanley's stock price compared with the company's operational size and dividend yields. The low Profit Rank could result from a one-off charge, for instance, for an accident, a legal settlement, or a restructuring project. If the company keeps its dividends high, the low expected profit may be transitory. If that is the case, the three good value ranks for Sales, Capital, and Dividends are reliable indicators for good stock price value, a low stock price. ...read more
Growth Strategy: Morgan Stanley Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 25 (better than 25% compared with alternatives), Morgan Stanley shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with all four metrics below average for Morgan Stanley. Sales Growth has a rank of 38, which means that currently professionals expect the company to grow less than 62% of its competitors. The same is valid for Profit Growth, with a rank of 37, and Capital Growth with 44. In addition, Stock Returns have a below market rank of 33, which means that the stock returns have recently been below 67% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 25, is a hold recommendation for growth and momentum investors. These are all bad growth momentum indicators. These are negative signals for investors interested in growth companies. Value is likely good for this company, as investors may have left this stock in the cold. If that is the case, investors should look at the company's outlook, especially Sentiment performance, because it may be a turnaround situation that could entail above-average stock returns in the future. But it remains a risky bet, as no growth signals are in the green zone yet. ...read more
Safety Strategy: Morgan Stanley Debt Financing Safety risky
| SAFETY METRICS | January 4, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 11 |
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| REFINANCING | ||||||||
| REFINANCING | 91 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 10 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 23 |
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ANALYSIS: With an Obermatt Safety Rank of 23 (better than 23% compared with alternatives), the company Morgan Stanley has much riskier financing practices than comparable other companies, which means that their overall debt burden is significantly above the industry average. This doesn't mean that the business of Morgan Stanley is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for Morgan Stanley and the other two below average. Refinancing is at 91, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 91% of its competitors. But Leverage is high with a rank of 11, meaning the company has an above-average debt-to-equity ratio. It has more debt than 89% of its competitors. Liquidity is also on the riskier side with a rank of 10, meaning the company generates less profit to service its debt than 90% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 23 (worse than 77% compared with alternatives), Morgan Stanley has a financing structure that is significantly riskier than that of its competitors. A good Refinancing Rank means that the problems of the company may not be around the corner. But high Leverage is only good if things go well, and low Liquidity is a signal for caution. The financing signals for Morgan Stanley are on the riskier side, requiring the company's future to be on the safer side. Investors may want to look at Growth and Sentiment ranks before making an investment decision. ...read more
Combined financial peformance: Morgan Stanley Lowest Financial Performance
| COMBINED PERFORMANCE | January 4, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 71 |
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| GROWTH | ||||||||
| GROWTH | 25 |
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| SAFETY | ||||||||
| SAFETY | 10 |
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| COMBINED | ||||||||
| COMBINED | 15 |
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ANALYSIS: With an Obermatt Combined Rank of 15 (worse than 85% compared with investment alternatives), Morgan Stanley (Investment Banking & Brokerage, USA) shares have lower financial characteristics compared with similar stocks. Shares of Morgan Stanley are a good value (attractively priced) with a consolidated Value Rank of 71 (better than 71% of alternatives) but show below-average growth (Growth Rank of 25), and are riskily financed (Safety Rank of 23), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 15, is a sell recommendation based on Morgan Stanley's financial characteristics. As the company Morgan Stanley's key financial metrics exhibit good value (Obermatt Value Rank of 71) but low growth (Obermatt Growth Rank of 25) and risky financing practices (Obermatt Safety Rank of 23), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 71% of comparable companies, may indicate the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity. ...read more
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