Back to top

Image: Bigstock

Is Morgan Stanley (MS) Stock Undervalued Right Now?

Read MoreHide Full Article

The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use a variety of methods, including tried-and-true valuation metrics, to find these stocks.

Luckily, Zacks has developed its own Style Scores system in an effort to find stocks with specific traits. Value investors will be interested in the system's "Value" category. Stocks with both "A" grades in the Value category and high Zacks Ranks are among the strongest value stocks on the market right now.

Morgan Stanley (MS - Free Report) is a stock many investors are watching right now. MS is currently sporting a Zacks Rank of #2 (Buy) and an A for Value. The stock is trading with P/E ratio of 13 right now. For comparison, its industry sports an average P/E of 13.96. Over the past year, MS's Forward P/E has been as high as 14.58 and as low as 11.69, with a median of 13.39.

Another notable valuation metric for MS is its P/B ratio of 1.83. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. This stock's P/B looks solid versus its industry's average P/B of 2.73. MS's P/B has been as high as 1.96 and as low as 1.44, with a median of 1.76, over the past year.

Finally, we should also recognize that MS has a P/CF ratio of 9.30. This data point considers a firm's operating cash flow and is frequently used to find companies that are undervalued when considering their solid cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 18.12. Over the past year, MS's P/CF has been as high as 10.82 and as low as 8.15, with a median of 9.51.

These are only a few of the key metrics included in Morgan Stanley's strong Value grade, but they help show that the stock is likely undervalued right now. When factoring in the strength of its earnings outlook, MS looks like an impressive value stock at the moment.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Morgan Stanley (MS) - free report >>

Published in