This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

5 Banks to Consider as Options Plays

MS Chart MS data by YCharts

Morgan Stanley (MS)

Book Value: $31.78

Morgan Stanley has bounced back from lows in June and July, but remains well below the all-important technical 200-day moving average near $16. Morgan Stanley has more or less treaded water during the last 12 months without gaining or losing much (with more than one move higher and lower in between).

With an average analyst target price of $20.35, Morgan Stanley appears to have a lot of upside relative to the other banks. The price-to-earnings ratio reflects relative higher optimism in Morgan too. Morgan is expected to bring home about 90 cents in earnings this year making the earnings multiple slightly higher than 16.

Part of the higher premium may come from the higher dividend yield Morgan offers. This stock currently has an annualized dividend of 20 cents, yielding 1.37%. Short interest is 1.5%, indicating a near zero level of interest from short sellers.

I would prefer to sell a November expiration covered call, but October is as close as we can get. The October $15 strike calls can be sold for about 80 cents. With a current stock price of $14.90, the maximum possible return is 90 cents for a gain of 12% in less than two months. The maximum risk is $14.10 per share. Dividend payments may positively impact the results.
2 of 6

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
BAC $14.56 0.00%
C $46.28 0.00%
JPM $63.20 0.00%
SPY $206.33 0.00%
WFC $49.98 0.00%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs