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Here's Why Morgan Stanley (MS) Fell More Than Broader Market

Morgan Stanley (MS) ended the recent trading session at $100.74, demonstrating a -0.78% swing from the preceding day's closing price. The stock's change was less than the S&P 500's daily loss of 0.27%. At the same time, the Dow lost 0.51%, and the tech-heavy Nasdaq lost 0.19%.

The the stock of investment bank has risen by 8.29% in the past month, leading the Finance sector's gain of 5.74% and the S&P 500's gain of 7.34%.

The upcoming earnings release of Morgan Stanley will be of great interest to investors. The company is predicted to post an EPS of $1.66, indicating a 33.87% growth compared to the equivalent quarter last year. Simultaneously, our latest consensus estimate expects the revenue to be $14.28 billion, showing a 6.09% escalation compared to the year-ago quarter.

For the full year, the Zacks Consensus Estimates are projecting earnings of $6.83 per share and revenue of $57.84 billion, which would represent changes of +25.09% and +6.82%, respectively, from the prior year.

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Investors should also pay attention to any latest changes in analyst estimates for Morgan Stanley. Recent revisions tend to reflect the latest near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.99% upward. Right now, Morgan Stanley possesses a Zacks Rank of #1 (Strong Buy).

In the context of valuation, Morgan Stanley is at present trading with a Forward P/E ratio of 14.86. This indicates a discount in contrast to its industry's Forward P/E of 18.37.

We can also see that MS currently has a PEG ratio of 1.24. 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. As the market closed yesterday, the Financial - Investment Bank industry was having an average PEG ratio of 1.15.

The Financial - Investment Bank industry is part of the Finance sector. This industry currently has a Zacks Industry Rank of 16, which puts it in the top 7% of all 250+ industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.

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