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Morgan Stanley (MS) Gains But Lags Market: What You Should Know

In the latest trading session, Morgan Stanley (MS) closed at $99.27, marking a +1.08% move from the previous day.

This story originally appeared on Zacks

Morgan Stanley (MS) closed at $99.27 in the latest trading session, marking a +1.08% move from the prior day. This change lagged the S&P 500's 1.17% gain on the day. Meanwhile, the Dow gained 1.87%, and the Nasdaq, a tech-heavy index, added 0.57%.

- Zacks

Prior to today's trading, shares of the investment bank had lost 1.66% over the past month. This has was narrower than the Finance sector's loss of 5.58% and the S&P 500's loss of 2.46% in that time.

Investors will be hoping for strength from Morgan Stanley as it approaches its next earnings release. The company is expected to report EPS of $1.81, down 5.73% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $14.3 billion, up 4.87% from the prior-year quarter.

MS's full-year Zacks Consensus Estimates are calling for earnings of $7.97 per share and revenue of $59.54 billion. These results would represent year-over-year changes of +21.12% and +23.53%, respectively.

Any recent changes to analyst estimates for Morgan Stanley should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. Morgan Stanley is holding a Zacks Rank of #3 (Hold) right now.

Valuation is also important, so investors should note that Morgan Stanley has a Forward P/E ratio of 12.32 right now. Its industry sports an average Forward P/E of 11.13, so we one might conclude that Morgan Stanley is trading at a premium comparatively.

It is also worth noting that MS currently has a PEG ratio of 1.75. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. MS's industry had an average PEG ratio of 0.57 as of yesterday's close.

The Financial - Investment Bank industry is part of the Finance sector. This group has a Zacks Industry Rank of 66, putting it in the top 26% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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