Does This Bank Stock Have Anything Left in the Tank?

The fundamentals for MS have proven to be secure

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The last time we checked in with Morgan Stanley (NYSE:MS), the bank stock was getting bombarded by options traders. Now, roughly two months later and heading into fall, it's worth revisiting MS to see if there is potential for investors. 

Morgan Stanley stock is up 50% in 2021, culminating in an Aug. 30 record high of $105.81. Since then though, MS has consolidated beneath this peak, with its 20-day moving average nestled below. Moreover, Morgan Stanley offers a forward dividend of $2.80 and a dividend yield of 2.69%.

From a fundamental point of view, Morgan Stanley stock still offers strong potential as a value play despite its bullish run over the past year. Morgan Stanley stock trades at a price-earnings ratio of 13.81, which is an attractive value given the financial company’s huge market cap of $190 billion and their solid top and bottom-line growth rate. Morgan Stanley's trailing 12-month revenues are up 15% compared to fiscal 2020 revenues and are up 45% since fiscal 2017. In addition, MS' trailing 12-month net income has increased 26% compared to fiscal 2020 net income and has increased 137% since fiscal 2017. MS also has a great balance sheet with $562 billion in cash and $340 billion in total debt. Overall, Morgan Stanley stock is a fairly low-risk stock with an excellent long-term trajectory.

Options traders are in luck at the moment. MS' Schaeffer's Volatility Scorecard (SVS) stands at 88 out of 100, indicating the equity has exceeded options traders' volatility expectations of the past year -- a boon for buyers. 


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