Morgan Stanley reports 351.87
B of total liabilities with total debt to equity ratio (D/E) of 3.28, which may imply that Morgan Stanley relies heavily on debt financing. The entity has a current ratio of 1.87, which is generally considered normal.
Volatility is a rate at which the price of Morgan Stanley or any other equity instrument increases or decreases for a given set of returns. It is measured by calculating the standard deviation of the annualized returns over a given period of time and shows the range to which the price of Morgan Stanley may increase or decrease. In other words, similar to Morgan's
beta indicator, it measures the risk of Morgan Stanley and helps estimate the fluctuations that may happen in a short period of time. So if prices of Morgan Stanley fluctuate rapidly in a short time span, it is termed to have high volatility, and if it swings slowly in a more extended period, it is understood to have low volatility. Please read more on our
technical analysis page.
How important is Morgan Stanley's Liquidity
Morgan Stanley
financial leverage refers to using borrowed capital as a funding source to finance Morgan Stanley ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Morgan Stanley financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Financial leverage can amplify the potential profits to Morgan Stanley's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of Morgan Stanley's financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets). Please check the
breakdown between Morgan Stanley's total debt and its cash.
Morgan Stanley Gross Profit
Morgan Stanley Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing Morgan Stanley previous period's values with its current period's values. Each time period you're measuring should be of equal lengths the increase or decrease, in a company's Gross Profit between two periods. Here we show Morgan Stanley Gross Profit growth over the last 10 years. Please check Morgan Stanley's
gross profit and other
fundamental indicators for more details.
Morgan Stanley Volatility Drivers
Morgan Stanley unsystematic risk is unique to Morgan Stanley and usually not directly affected by the market or economic environment. An example of unsystematic risk is the possibility of poor earnings or a layoff due to coronavirus. One may mitigate nonsystematic risk by buying different securities in the same industry or by buying in different sectors. For example, if you have a position in Morgan Stanley you can also buy
Lazard. You can also mitigate this risk by investing in the financials sector as well as in companies having nothing to do with it. This type of risk is also called diversifiable risk and can be understood from analyzing Morgan Stanley important indicators over time. Here we run a correlation analysis between relevant fundamental ratios over at least ten year period to find a relationship in the way they react to changes in Morgan Stanley income statement and balance sheet. Here are more
details about Morgan volatility.
Click cells to compare fundamentals
Another Deeper Perspective
The small fall in market price for the last few months may encourage retail investors to take a closer look at the firm as it is trading at a share price of
96.24 on
14,760,228 in trading volume. The company executives did not add much value to Morgan Stanley investors in
December. However, diversifying your holdings with Morgan Stanley or similar stocks can still protect your portfolio during high-volatility market scenarios. The stock standard deviation of daily returns for 90 days investing horizon is currently 1.88. The below-average Stock volatility is a good sign for longer-term investment options and for buy-and-hold investors.
| 2019 | 2020 | 2021 | 2022 (projected) |
Net Income | 9.04 B | 11 B | 12.65 B | 9.99 B | Gross Profit | 41.42 B | 48.2 B | 55.43 B | 50.17 B |
Our perspective of the latest Morgan Stanley spike
Latest jensen alpha is at -0.11. Morgan Stanley exhibits very low volatility with skewness of -0.19 and kurtosis of 0.1. However, we advise investors to further study Morgan Stanley technical indicators to make sure all market info is available and is reliable. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure Morgan Stanley's stock risk against market volatility during both bullying and bearish trends. The higher level of volatility that comes with bear markets can directly impact Morgan Stanley's stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.
Morgan Stanley Implied Volatility
Morgan Stanley's implied volatility exposes the market's sentiment of Morgan Stanley stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if Morgan Stanley's implied volatility is high, the market thinks the stock has potential for high price swings in either direction. On the other hand, the low implied volatility suggests that Morgan Stanley stock will not fluctuate a lot when Morgan Stanley's options are near their expiration.
Our Final Take On Morgan Stanley
When is the right time to buy or sell Morgan Stanley? Buying stocks such as Morgan Stanley isn't very hard. However, what challenging for most investors is doing it at the right time. Proper
market timing is something most people cannot do without
sophisticated tools, which help to isolate the right opportunities, deliver winning trades and diversify portfolios on a daily basis.
Taking everything into account, as of the 19th of January 2022, our ongoing 90 days buy-hold-sell recommendation on the enterprise is
Strong Hold. We believe Morgan Stanley is
undervalued with
close to average chance of financial distress for the next two years.
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Vlad Skutelnik is a Macroaxis Contributor. Vlad covers stocks, funds, cryptocurrencies, and ETFs that are traded in North America, focusing primarily on fundamentals, valuation and market volatility. He has many years of experience in fintech, predictive investment analytics, and risk management.
View Profile This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Vlad Skutelnik do not own shares of Morgan Stanley. Please refer to our
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