Highly Regarded

Is Morgan Stanley (MS) Stock Undervalued or Overvalued?

Trailing-twelve-month multiples vs Financials sector peers in our coverage

In Line TTM fundamentals · sector averages from covered peers

MS trades at 22.8× TTM earnings — roughly in line with its Financials sector average of 24.0×.

The Numbers

P/E (TTM)

22.8×

Sector avg: 24.0×

P/S (TTM)

5.1×

Sector avg: 8.8×

Market Cap

$351.55B

EPS (TTM): $9.75

Revenue (TTM)

$68.98B

Net income: $16.32B

Financials Peer Comparison

How MS's multiples stack up against sector peers we cover. Click any peer for its own valuation breakdown.

Stock Price P/E (TTM)
MS This page $222.08 22.8×
BRK.B $506.66 —
V $357.21 —
MA $533.36 34.1×
BAC $59.89 16.4×
GS $1054.88 21.4×

Is the Multiple Justified?

July 6, 2026

Morgan Stanley's P/E ratio of 22.7x, slightly below the financial sector average of 23.6x, reflects a solid but not premium valuation. The company recently demonstrated strong capital management by announcing a 15% dividend increase and a $20 billion share buyback program following successful stress tests. Q1 2026 results showed a 16% year-over-year net revenue increase to $20.6 billion, driven by robust performance in both its Wealth Management and Institutional Securities divisions. The firm's strategic emphasis on its wealth management arm, which provides stable, recurring fee revenue, underpins its operational strength. While showing strong momentum and capital returns, the slight discount may indicate market prudence regarding broader economic uncertainties impacting investment banking activities.

Sources

Frequently Asked Questions

Is MS overvalued or undervalued?
On trailing-twelve-month earnings, MS trades at 22.8x versus a Financials sector average of 24.0x in our coverage — a 5% discount. Whether that's justified depends on growth, margins, and risk; see the context above.
What does the P/E ratio tell you?
Price-to-earnings compares a company's share price with its per-share profits. A higher multiple means investors pay more per dollar of earnings — often for faster expected growth — while a lower one can signal slower growth or higher perceived risk.
Why compare against the sector average?
Valuation multiples vary structurally between industries — software typically trades richer than banks or energy. Comparing MS with its own Financials peers is more informative than comparing against the whole market.
Is a cheap stock automatically a good buy?
No. A discount can be justified by weak growth or elevated risk (a "value trap"), and a premium can be earned by quality and consistency. Valuation is one input — pair it with the fundamentals and the AI context on this page.

Methodology

Multiples are computed from trailing-twelve-month fundamentals (from company filings) and the latest share price: P/E is price ÷ diluted EPS, and P/S is market cap ÷ revenue. Sector averages use the Financials names in our 50-stock coverage with positive earnings — a deliberately like-for-like, if imperfect, benchmark.

Stocks with negative trailing earnings are compared on price-to-sales instead. Multiples update with prices and fundamentals; AI context refreshes weekly.

Not Financial Advice

This page is for education and information only. Indicators are mechanical calculations, AI commentary can contain errors, and nothing here is a recommendation to buy or sell any security. Do your own research and consider consulting a qualified financial advisor. See our full disclaimer.

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Same question, Financials peers

BAC JPM MA GS V BRK.B