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 21.9× TTM earnings — roughly in line with its Financials sector average of 25.2×.

The Numbers

P/E (TTM)

21.9×

Sector avg: 25.2×

P/S (TTM)

4.9×

Sector avg: 9.3×

Market Cap

$337.83B

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 $213.41 21.9×
BRK.B $504.14 —
V $379.47 —
MA $589.33 37.7×
BAC $61.96 16.9×
GS $1026.48 20.9×

Is the Multiple Justified?

August 9, 2026

Morgan Stanley (MS) currently trades at a trailing twelve-month (TTM) Price/Earnings (P/E) multiple of 22.2x, a slight discount to the Financials sector average of 24.1x. This valuation reflects a mixed operational environment, as seen in its Q2 2026 results. While the firm's wealth management and investment management segments demonstrated resilience, investment banking revenues faced headwinds due to a slower global deal-making landscape. Morgan Stanley's strategic pivot towards a more stable, fee-based revenue model, emphasizing wealth and investment management, aims to mitigate the cyclicality of its capital markets businesses. This focus provides a more predictable earnings stream. The modest P/E discount may be influenced by the current subdued activity in investment banking and trading, which could be tempering overall growth expectations compared to some peers. However, the strength of its diversified business model, particularly in wealth management, provides a solid foundation for future performance.

Sources

Frequently Asked Questions

Is MS overvalued or undervalued?
On trailing-twelve-month earnings, MS trades at 21.9x versus a Financials sector average of 25.2x in our coverage — a 13% 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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