Morgan Stanley’s Stock Rises Despite 40% Drop in Year-Over-Year Net Income
January 18, 2023
Trending News ☀️
Morgan Stanley Intrinsic Value – Morgan Stanley ($NYSE:MS), a global financial services firm, recently reported its Q4 results, which caused its stock to rise by 4%. Despite this, the company’s net income had dropped by an astonishing 40% year-over-year. This stark decrease in earnings has left many investors and analysts concerned about the future of the company. As a result of the decrease in net income, Morgan Stanley’s total revenues have also decreased. Despite these worrying figures, Morgan Stanley’s stock still managed to rise due to better-than-expected performance in other areas.
This increase was mainly driven by higher equity underwriting fees and higher debt underwriting fees. Overall, these results are mixed. This is cause for concern, as it could mean that the company is struggling to compete with other global banks. It remains to be seen whether Morgan Stanley can reverse this trend and return to its former glory.
Stock Price
Despite news sentiment that is mostly negative, Morgan Stanley’s stock continues to rise. On Tuesday, the stock opened at $95.9 and closed at $97.1, a 5.9% increase from the previous closing price of $91.7. Morgan Stanley’s investment banking business has been affected by the downturn, as has its wealth and asset management divisions. The company’s overall revenues have also declined, as have its profits. This could be due to several factors.
Firstly, investors may be betting that the company’s long-term prospects are still strong and that it will eventually recover from the current situation. Secondly, the company’s cost-cutting measures and asset sales have helped to improve its financial performance. Overall, while Morgan Stanley’s stock has risen despite a 40% year-over-year drop in net income, this does not necessarily mean that the company is immune to the effects of the pandemic. Investors should still exercise caution when investing in the company. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Morgan Stanley. More…
| Total Revenues | Net Income | Net Margin |
| 52.02k | 12.02k | 24.8% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Morgan Stanley. More…
| Operations | Investing | Financing |
| 17.63k | -49.9k | 41.55k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Morgan Stanley. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 1.17M | 1.07M | 59.97 |
Key Ratios Snapshot
Some of the financial key ratios for Morgan Stanley are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 12.4% | – | – |
| FCF Margin | ROE | ROA |
| 28.7% | 10.0% | 0.9% |
VI Analysis – Morgan Stanley Intrinsic Value Calculator
Morgan Stanley is a renowned financial services company whose fundamentals reflect its long-term potential. The value of its stock can be estimated using the VI Line, a simplified method of analyzing a company’s financials. The intrinsic value of Morgan Stanley’s stock is calculated to be around $80.5, though it is currently being traded at $97.1, which is a 21% overvaluation. The stock is considered to be overpriced relative to its fundamental value. This suggests that the stock may be too risky to invest in at the current price and investors should wait for the price to drop closer to its intrinsic value before considering investing. Other factors such as market sentiment, economic conditions, and other financial metrics should also be taken into consideration when evaluating Morgan Stanley’s stock. More…
VI Peers
Morgan Stanley is an American multinational investment bank and financial services company headquartered in New York City. The company’s name is derived from its original Wall Street address, which was 65 Broadway until the building was destroyed in the September 11 attacks. Goldman Sachs Group Inc, JPMorgan Chase & Co, Bank of America Corp are its competitors.
– Goldman Sachs Group Inc ($NYSE:GS)
Goldman Sachs Group Inc. is an American multinational investment bank and financial services company headquartered in New York City. It offers services in investment banking, asset management, and securities services. As of 2020, it had the fifth-highest market capitalization of any company in the United States at $81.6 billion. Goldman Sachs has a return on equity of 9.0% as of 2022. The company has been involved in several controversies in recent years, including the 1MDB scandal.
– JPMorgan Chase & Co ($NYSE:JPM)
JPMorgan Chase & Co is an investment bank and financial services company headquartered in New York City. The company has a market capitalization of $373.1 billion as of 2022. JPMorgan Chase & Co offers a variety of services including investment banking, asset management, treasury and securities services, and commercial banking. The company has a diversified client base including corporations, governments, and individuals.
– Bank of America Corp ($NYSE:BAC)
Bank of America Corporation (abbreviated as BofA) is an American multinational banking and financial services holding company headquartered in Charlotte, North Carolina with central hubs in New York City, London, Hong Kong, Minneapolis, and Toronto. It is the second largest bank holding company in the United States by assets. As of 2020, Bank of America was ranked 26th on the Fortune 500 rankings of the largest United States corporations by total revenue. The company serves clients in more than 150 countries. It is a member of the World Bank Group’s International Finance Corporation (IFC), the United Nations’ Global Compact, and Dow Jones Sustainability Index (DJSI) World and Europe.
Bank of America’s market cap is $287.93B as of 2022.
Summary
Morgan Stanley is a financial services firm that experienced a significant drop in its year-over-year net income of 40%. Despite this, the company’s stock price rose on the news. This could be attributed to investors seeing potential in the company’s future, or perhaps the market was expecting an even worse result.
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