- Based on my base case scenario in the free cash flow to equity model, I increase Morgan Stanley's stock value per share from $102 to $106.
- According to the forward price/book ratio of 1.5x, I estimate that MS stock is worth $91.
- Morgan Stanley’s provision for credit losses increased from $-98 million to $57 million. It means that the company’s allowance has increased; implying higher risks.
- Compared to 1Q 2021, MS's 1Q 2022 CET1 ratio and Tier 1 ratio dropped by 250 bps and 220 bps, respectively, due to higher RWAs.
For further details see:
Morgan Stanley Stock: Higher Risk, Higher Valuation