Research Alert: CFRA Upgrades To Strong Buy From Buy Opinion On Shares Of Morgan Stanley
CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:We keep our $220 target price assuming favorable capital market conditions and using a forward 2026 P/E of 17.7x, vs. the three-year (18.0x) and five-year (15.8x) historical averages. We increase our 2026 EPS estimate by $1.00 to $12.45 and 2027's by $0.60 to $12.85 on project revenue of $77.5B (prior $76.1B) and $80.0B (unchanged), respectively. We think the catalyst for higher growth is transactional within trading and investment banking. MS should also benefit from an elevated equity market that will drive higher fee income and net interest income in its Wealth Management and Investment Management segments. MS confirmed improving market conditions for investment banking advisory activities for equity/debt underwriting and M&A transactions in the pipeline for 2026. We are seeing operating leverage drive wider margins, with AI as a potential input to realize better efficiency ratios. Market risks include high asset prices, tight credit spreads, and uncertainty around the future path of interest rates.