Highly Regarded

Is Morgan Stanley (MS) Stock Undervalued or Overvalued?

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

22% Discount TTM fundamentals · sector averages from covered peers

MS trades at 18.7× TTM earnings — a 22% discount to its Financials sector average of 23.9× in our coverage.

The Numbers

P/E (TTM)

18.7×

Sector avg: 23.9×

P/S (TTM)

4.2×

Sector avg: 9.4×

Market Cap

$288.26B

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 $182.10 18.7×
BRK.B $525.88 —
V $399.62 —
MA $616.27 39.4×
BAC $51.74 14.1×
GS $891.33 18.1×

Is the Discount Justified?

October 11, 2026

Morgan Stanley's P/E ratio of 19.5x places it below the financials sector average of 22.5x. The firm has strategically diversified its business mix, emphasizing wealth and investment management, which typically provides more stable, fee-based revenue streams compared to the cyclical nature of traditional investment banking. While its capital markets businesses can experience volatility, recent strong performance in wealth management, with record net revenues and client assets, and a rebound in investment banking activity, underscore its efforts to build a more resilient business model. The current valuation may reflect a cautious market outlook on the broader financial sector or the inherent cyclicality of some of its segments.

Sources

Frequently Asked Questions

Is MS overvalued or undervalued?
On trailing-twelve-month earnings, MS trades at 18.7x versus a Financials sector average of 23.9x in our coverage — a 21.8% 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

GS V BAC MA BRK.B JPM