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Morgan Stanley MS

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Morningstar’s Analysis

Valuation
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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Morgan Stanley’s Strong Revenue and Earnings Streak Continued in the Third Quarter

Michael Wong, CFA, CPA Sector Director

Analyst Note

| Michael Wong, CFA, CPA |

As we expected, Morgan Stanley’s recent streak of strong revenue and earnings was sustained in the third quarter, and the company achieved an annualized return on tangible equity of about 20%. Net revenue of $14.8 billion was 26% higher than a year ago and basically equal to the second quarter. Record investment banking and growth in asset management revenue and net interest income offset a decline in trading revenue. We don’t anticipate making a material change to our $85 fair value estimate for narrow-moat Morgan Stanley.

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Company Profile

Business Description

Morgan Stanley is a global investment bank whose history, through its legacy firms, can be traced back to 1924. The company has institutional securities, wealth management, and investment management segments. The company had about $4 trillion of client assets as well as nearly 70,000 employees at the end of 2020. Approximately 40% of the company's net revenue is from its institutional securities business, with the remainder coming from wealth and investment management. The company derives about 30% of its total revenue outside the Americas.

Contact
1585 Broadway
New York, NY, 10036
T +1 212 761-4000
Sector Financial Services
Industry Capital Markets
Most Recent Earnings Jun 30, 2021
Fiscal Year End Dec 31, 2021
Stock Type Cyclical
Employees 71,000

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