Analyst Note| Michael Wong, CFA, CPA |
Narrow moat rated Morgan Stanley reported revenue and earnings for the first quarter of 2022 that were comparable to recent quarters, but we believe that results may look a bit more volatile like peers over the next several quarters. The company reported earnings to common shareholder of $3.5 billion, or $2.02 per diluted share, on $14.8 billion of net revenue, and returns on tangible equity were strong at 19.8%. The company averaged $14.9 billion of net revenue and $2.01 of earnings per diluted share per quarter in 2021, so it looks like a continuation of steady results; however, it wasn’t. We are maintaining our $95 fair value estimate for Morgan Stanley and assess shares as modestly undervalued.