Morgan Stanley had a tough time finding profits last year despite its revenue growth ranging from 19% up to 62%. That changed last quarter when it posted strong first quarter earnings alongside its continued stout revenue growth. On Tuesday the Relative Strength (RS) Rating for Morgan Stanley stock climbed to 73, up from 69 the day before.
The upgraded 73 RS Rating shows that Morgan Stanley stock topped 73% of all stocks for price performance this past year.
Morgan Stanley Trading Near Two-Year High
Morgan Stanley broke out, rising to 103.25 on May 24, its highest price in more than two years. It's consolidated since then and is now trading slightly below the recent 100.99 entry from a consolidation. Tuesday afternoon, Morgan Stanley traded around 97, up fractionally for the day.
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As a result of weak earnings growth last year Morgan Stanley carries a so-so 68 Earnings Per Share Rating out of 99.
However, among its other key ratings Morgan Stanley stock has a bullish 92 Composite Rating, which puts it in the top 8% of stocks overall for a group of the most important fundamental and technical metrics. Further, it boasts a B+ Accumulation/Distribution Rating on an A+ to E scale. The B+ rating shows that ETFs, mutual funds and the like are fairly heavy buyers of its stock.
From early 2023 to the end of the year, Morgan Stanley was profitable but it reported year-over-year quarterly EPS decreases of 14%, 10% and 35%. Then, last quarter Morgan Stanley recorded a 19% jump in earnings to $2.02 per share on 19% higher revenue of $26.3 billion.
Meanwhile, over the last four quarters the banking and wealth management company reported revenue gains of 62%, 48%, 21% and 19%. In other words, its revenue continued to grow, albeit as a slower pace, until its earnings reversed higher too.
The $64,000 Question: Can Morgan Stanley Keep Rising?
The question now is whether it has truly turned a corner and can put up healthy earnings and revenue growth numbers, or was the rise in earnings a one-off quarter. The company says on its website it will announce Q2 earnings the morning of July 16.
Morgan Stanley holds the No. 6 rank among its peers in the 22-stock Banks-Money Centers industry group. Goldman Sachs, Sumitomo Mitsui Finl and UBS Group are among the top five highly rated stocks in the group.
IBD's proprietary Relative Strength Rating tracks market leadership by using a 1 (worst) to 99 (best) score that shows how a stock's price performance over the trailing 52 weeks compares to the rest of the market.
Over 100 years of market history shows that the best stocks often have an 80 or higher RS Rating in the early stages of their moves. See if Morgan Stanley can continue to rebound and hit that benchmark.
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