Morgan Stanley (MS)
NYSE:MS
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Morgan Stanley
(NYSE:MS)
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Rating:69Neutral
Price Target:
$173.00
▲(2.71% Upside)
Action:DowngradedDate:02/20/26
The score is driven primarily by mixed fundamentals: strong revenue/profitability momentum is offset by highly volatile/mostly negative operating and free cash flow and leverage sensitivity. The earnings call adds support via strong execution, capital strength, and shareholder returns, while technicals are mildly bearish near-term and valuation is reasonable with a supportive dividend yield.
Positive Factors
Record scale & diversified franchise
Morgan Stanley's record revenues, strong EPS and high ROTCE reflect durable scale across advisory, markets and wealth. Broad revenue mix reduces single-market dependence and supports multi-cycle earnings resilience and capacity to invest in growth initiatives over the medium term.
Negative Factors
Weak and volatile cash generation
Repeated negative or highly variable operating and free cash flow undermines earnings quality and reduces financial flexibility. Over the medium term this can force reliance on capital markets, limit organic reinvestment or constrain aggressive capital allocation in stressed environments.
Read all positive and negative factors
Positive Factors
Negative Factors
Record scale & diversified franchise
Morgan Stanley's record revenues, strong EPS and high ROTCE reflect durable scale across advisory, markets and wealth. Broad revenue mix reduces single-market dependence and supports multi-cycle earnings resilience and capacity to invest in growth initiatives over the medium term.
Read all positive factors
Morgan Stanley (MS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$267.44B
Dividend Yield2.14%
Average Volume (3M)7.10M
Price to Earnings (P/E)16.5
Beta (1Y)1.47
Revenue Growth7.22%
EPS Growth48.18%
CountryUS
Employees81,000
SectorFinancial
Sector Strength70
IndustryFinancial - Capital Markets
Share Statistics
EPS (TTM)2.68
Shares Outstanding1,587,860,200
10 Day Avg. Volume5,520,917
30 Day Avg. Volume7,101,702
Financial Highlights & Ratios
PEG Ratio0.58
Price to Book (P/B)2.50
Price to Sales (P/S)2.43
P/FCF Ratio6.05
Enterprise Value/Market Cap2.41
Enterprise Value/Revenue5.60
Enterprise Value/Gross Profit9.81
Enterprise Value/Ebitda24.18
Forecast
1Y Price Target
$194.90Price Target Upside15.72% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering12
EPS Forecast (FY)11.39
Revenue Forecast (FY)$76.46B
Morgan Stanley Business Overview & Revenue Model
Company Description
Morgan Stanley, a financial holding company, provides various financial products and services to corporations, governments, financial institutions, and individuals in the Americas, Europe, the Middle East, Africa, and Asia. It operates through Ins...
How the Company Makes Money
Morgan Stanley makes money primarily by earning fees and commissions for advice and execution services, and by generating interest and trading-related revenue from its financing and markets activities. Key revenue streams include: (1) Wealth Manag...
Morgan Stanley Key Performance Indicators (KPIs)
Any
Net Income Breakdown
Provides a detailed view of profit sources, illustrating how different operations contribute to the bottom line and financial health.
Provides a detailed view of profit sources, illustrating how different operations contribute to the bottom line and financial health.
Data provided by:
The Fly
The FlyMorgan Stanley Earnings Call Summary
Earnings Call Date:Jan 15, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 15, 2026
Earnings Call Sentiment Positive
The call conveyed strong, broad-based execution: record revenues and EPS, meaningful asset and flow growth in wealth and investment management, market share gains in institutional securities, a robust capital position (15% CET1 and >300 bps excess), and ongoing investment in AI, technology and strategic initiatives. Near-term challenges were acknowledged—DCP accounting transition and transitional costs, softer pockets in fixed income and commodities, mark-to-market volatility in some investment management strategies, and macro/regulatory uncertainties—but these were framed as manageable within the firm’s capital and operating plans. On balance the positive operational and financial momentum substantially outweighed the listed headwinds.Positive Updates
Record Revenue and Earnings
Full-year revenues reached a record $70.6 billion and fourth-quarter revenues were $17.9 billion. Full-year EPS was $10.21 and Q4 EPS was $2.68. ROTCE was 21.6% for the year and 21.8% in the quarter. The firm delivered operating leverage while investing for growth, with the full-year efficiency ratio improving to 68.4%.
Negative Updates
DCP Accounting Impact and Transition Costs
Deferred compensation plan (DCP) dynamics negatively impacted the quarterly wealth margin by ~95 basis points. Management will transition economic hedges for DCP obligations to derivatives and increase the cash component of adviser compensation to reduce accounting-driven volatility; these changes will incur transitional costs and may cause near-term P&L noise.
Read all updates
Q4-2025 Updates
Positive
Negative
Record Revenue and Earnings
Full-year revenues reached a record $70.6 billion and fourth-quarter revenues were $17.9 billion. Full-year EPS was $10.21 and Q4 EPS was $2.68. ROTCE was 21.6% for the year and 21.8% in the quarter. The firm delivered operating leverage while investing for growth, with the full-year efficiency ratio improving to 68.4%.
Read all positive updates
Company Guidance
The firm’s guidance was largely conservative and execution‑focused: management is keeping its firm‑wide targets unchanged while saying it will “execute at or above” those goals in a welcoming market and deliver “higher lows” in tougher environments; near‑term financial guidance calls for Q1 net interest income roughly flat Q/Q with NII expected to trend higher through 2026 (assuming the forward curve, incremental loan growth and deposit mix), a 2026 tax rate of 22–23%, and a Q1 transition of DCP economic hedges to derivatives plus an increased cash component of adviser compensation. Capital and allocation guidance: CET1 ended 2025 at 15% with over 300 bps of excess capital, continued prudent dividend growth (quarterly dividend now $1.00 after four consecutive 7.5¢ increases) and opportunistic buybacks (FY2025 repurchases $4.6B, including $1.5B in Q4). Management anchored this guidance with 2025 performance metrics: total client assets $9.3T, FY revenues $70.6B (Q4 $17.9B), EPS $10.21 (Q4 $2.68), ROTCE 21.6% (Q4 21.8%), efficiency ratio ~68.4% for the year; business‑level metrics cited include Wealth net new assets $356B and fee‑based flows $160B (Wealth revenues $31.8B, 29% margin; Q4 Wealth $8.4B, 31.4% margin), AUM $1.9T, Institutional Securities revenues $33.1B (Investment Banking $7.6B; Equities $15.6B; Fixed Income $8.7B), standardized RWAs $553B, total spot assets $1.4T, deposits $408B, bank lending balances $181B and Q4 NII $2.1B.Morgan Stanley Financial Statement Overview
Summary
Income Statement
78
Positive
Balance Sheet
64
Positive
Cash Flow
32
Negative
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 114.98B | 103.14B | 88.29B | 62.48B | 57.78B |
| Gross Profit | 65.62B | 57.36B | 50.13B | 49.93B | 56.41B |
| EBITDA | 26.61B | 22.76B | 16.07B | 18.09B | 23.88B |
| Net Income | 16.86B | 13.39B | 9.09B | 11.03B | 15.03B |
Balance Sheet | |||||
| Total Assets | 1.42T | 1.22T | 1.19T | 1.18T | 1.19T |
| Cash, Cash Equivalents and Short-Term Investments | 539.97B | 401.59B | 461.89B | 467.86B | 500.35B |
| Total Debt | 475.56B | 360.49B | 339.04B | 308.75B | 305.36B |
| Total Liabilities | 1.31T | 1.11T | 1.09T | 1.08T | 1.08T |
| Stockholders Equity | 111.63B | 104.51B | 99.04B | 100.14B | 105.44B |
Cash Flow | |||||
| Free Cash Flow | 46.10B | -2.10B | -36.95B | -9.47B | 31.66B |
| Operating Cash Flow | 49.00B | 1.36B | -33.54B | -6.40B | 33.97B |
| Investing Cash Flow | -144.22B | -29.46B | -3.08B | -11.63B | -49.90B |
| Financing Cash Flow | 98.31B | 46.76B | -2.73B | 22.71B | 41.55B |
Morgan Stanley Technical Analysis
Positive
168.43
Price Trends
169.08
Negative
172.01
Negative
160.35
Positive
Market Momentum
-0.35
Negative
56.52
Neutral
80.45
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MS, the sentiment is Positive. The current price of 168.43 is above the 20-day moving average (MA) of 161.54, below the 50-day MA of 169.08, and above the 200-day MA of 160.35, indicating a neutral trend. The MACD of -0.35 indicates Negative momentum. The RSI at 56.52 is Neutral, neither overbought nor oversold. The STOCH value of 80.45 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MS.
Morgan Stanley Risk Analysis
Morgan Stanley disclosed 75 risk factors in its most recent earnings report. Morgan Stanley reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Morgan Stanley Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $163.55B | 20.00 | 17.91% | 1.07% | 5.90% | 66.60% | |
69 Neutral | $267.44B | 16.54 | 15.45% | 2.14% | 7.22% | 48.18% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
67 Neutral | $802.10B | 15.75 | 15.95% | 1.79% | 1.89% | 12.32% | |
66 Neutral | $360.84B | 13.28 | 10.15% | 1.93% | 0.15% | 33.84% | |
64 Neutral | $256.44B | 16.00 | 13.81% | 1.55% | 2.31% | 44.49% | |
58 Neutral | $204.90B | 21.83 | 6.71% | 1.94% | -0.62% | 105.57% |
* Financial Sector Average
MS
Morgan Stanley
168.43
59.65
54.84%
BAC
Bank of America
50.28
13.95
38.39%
C
Citigroup
117.13
54.61
87.34%
JPM
JPMorgan Chase
297.40
67.53
29.38%
SCHW
Charles Schwab
93.34
19.01
25.57%
GS
Goldman Sachs Group
864.15
357.77
70.65%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.