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Morgan Stanley’s (MS) Top Line Shows Promise: Time to Buy?

Zacks

On May 18, we issued an updated research report on Morgan Stanley MS. The company’s improving revenues along with initiatives to reduce expenses are driving its performance. However, strict regulations are a cause of concern.

Shares of Morgan Stanley have increased 2.1% in the last six months, outpacing the Zacks categorized Financial – Investment Bank industry’s decline of 2%.

Moreover, the company’s Zacks Consensus Estimate for the current year has been revised 1.9% upward, over the past 30 days. As a result, it currently carries a Zacks Rank #2 (Buy).


The company’s trading revenues have witnessed compound annual growth rate of 2.9%, over the last four years (ending 2016). This uptrend might continue on the back of uncertainties in the market over Trump’s policies.

Morgan Stanley remains on track to streamline expenses by the end of 2017 through ‘Project Streamline.’ The project was launched with an aim to reduce infrastructure expenses.

However, stringent regulations remain a major headwind for the company. Also, stricter capital requirement is likely restrict its flexibility in making investments.

Some better-ranked stocks in the financial space include Comerica Inc. CMA, The PNC Financial Services Group, Inc. PNC and Northern Trust Corp. NTRS. All the stocks hold a Zacks Rank #2.You can see the complete list of today’s Zacks #1 Rank(Strong Buy) stocks here.

Comerica‘s earnings estimates were revised 8.4% upward for the current year, in the past 30 days. Also, its share price jumped 10.8% over the last six months.

PNC Financial’s current-year earnings estimates were revised 3.2% upward, over the last 60 days. Further, its shares increased 5.5% in the last six months.

Northern Trust witnessed a1.1% upward earnings estimates revision for the current year, in the past 30 days. Moreover, its shares gained 6.4% in the last six months.

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