Morgan Stanley (MS) has broken out to new all-time highs, signaling a potential trend extension. The current backdrop is supportive for boththe firm’s investment banking arm and the firm’s wealth managementengines. Recent results showed solid top and bottom line growth, accelerating client asset flows, and renewed capital returns (dividend increase + buybacks), reinforcing the case for further upside with defined risk. Trade timing MSjust broke out above its resistance level at $145to a new all-time high on above‑average volume. Relative strength vs. the financial sector has been improving and confirms the breakout, suggesting there is potentially institutional accumulation. Fundamentals Morgan Stanley screens attractively versus Capital Markets peers on valuation with comparable or better profitability. MS trades at a discount to its peers with strong profitability and healthy growth expectations—a strong setup if capital‑markets activity continues to normalize. Bullish thesis Earnings momentum: Q2 FY25 revenue rose to$16.8Bwith EPS$2.13, supported by strength across Institutional Securities and Wealth. Capital returns & balance‑sheet: MSraised its quarterly dividend to $1.00and re‑authorized a$20Bmulti‑year buyback, reflecting robust capital and management confidence. Improving deal environment:Management and bankers expectstronger IPO activity into the 2 nd half of 2025 and 2026. MS ranked at or near the top of global dealmaking firms. Attractive valuation vs. peers: Despite the improving setup, MS trades at a discount to several large‑cap peers on P/E and P/B, while still delivering 18% ROTCE. Options trade To express the bullish view with defined risk, I’m buying the Sept $145/155 Call Vertical @ $4.55 Debit. This entails: BuySept. 19 $145Call @$6.00 SellSept. 19 $155Call @$1.45 DISCLOSURES: None. All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, NBC UNIVERSAL, their parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY . THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL’S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. Click here for the full disclaimer.
