Morgan StanleyShort
Morgan Stanley SHORT
Updated
Short from $58.02 will continue to short up to $66.
Market Cap - 102.8B
VWAP - 56.77
P/B - 1.49
Debt/Capital - 71.05%
Beta - 1.49
P/E - 18.13
- A major chunk of Morgan Stanley's revenues come from trading activities, which obviously is dependent on what the market is doing. The capital markets have performed very well in the past which lead to decent trading revenues - though since 1Q17 this trend has reversed (which is odd considering what the markets have done since then?!) They have had a slowdown in client activity and the low volatility led to a 1% decline in equity trading and a 4% in fixed income in 2017. This is expected continue in the near term.
- MS 12-month ROE undermines its growth potential. The company's ROE is 10.07% which has gradually improved since the crisis is much lower than the S&P 500's ROE of 16.08%. Showing its not using its shareholder's funds effectively.
- They continue attempting to strengthen their corporate banking section of the company. It was seeing a rise in net interest income over the past couple of years. Though again, since 1Q17 net interest income started to fall. In 2017 the net income interest fell 11% YoY - mainly due to interest expenses up 72%.
NeroTree Capital rates Morgan Stanley as a SELL with a price target of $40 over the next 52w.
Market Cap - 102.8B
VWAP - 56.77
P/B - 1.49
Debt/Capital - 71.05%
Beta - 1.49
P/E - 18.13
- A major chunk of Morgan Stanley's revenues come from trading activities, which obviously is dependent on what the market is doing. The capital markets have performed very well in the past which lead to decent trading revenues - though since 1Q17 this trend has reversed (which is odd considering what the markets have done since then?!) They have had a slowdown in client activity and the low volatility led to a 1% decline in equity trading and a 4% in fixed income in 2017. This is expected continue in the near term.
- MS 12-month ROE undermines its growth potential. The company's ROE is 10.07% which has gradually improved since the crisis is much lower than the S&P 500's ROE of 16.08%. Showing its not using its shareholder's funds effectively.
- They continue attempting to strengthen their corporate banking section of the company. It was seeing a rise in net interest income over the past couple of years. Though again, since 1Q17 net interest income started to fall. In 2017 the net income interest fell 11% YoY - mainly due to interest expenses up 72%.
NeroTree Capital rates Morgan Stanley as a SELL with a price target of $40 over the next 52w.
Trade closed manually
Cut 50% of the 8.8% profit on this short taken. Will look to short again if we see some buying here above our original entry. Long term target of $40 remains the same.
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