Morgan Stanley (MS): Today's Featured Financial Services Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Morgan Stanley ( MS) pushed the Financial Services industry lower today making it today's featured Financial Services laggard. The industry as a whole closed the day down 0.3%. By the end of trading, Morgan Stanley fell 70 cents (-3.8%) to $17.79 on heavy volume. Throughout the day, 51 million shares of Morgan Stanley exchanged hands as compared to its average daily volume of 21.2 million shares. The stock ranged in price between $17.70-$18.57 after having opened the day at $18.56 as compared to the previous trading day's close of $18.49. Other companies within the Financial Services industry that declined today were: Greenhill ( GHL), down 8%, Oppenheimer Holdings Inc. Class A ( OPY), down 7.8%, SWS Group ( SWS), down 6.5%, and Artio Global Investors ( ART), down 5.2%.
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Morgan Stanley, a financial holding company, provides various financial products and services to corporations, governments, financial institutions, and individuals worldwide. Morgan Stanley has a market cap of $35.3 billion and is part of the financial sector. The company has a P/E ratio of 13.4, below the average financial services industry P/E ratio of 15.4 and below the S&P 500 P/E ratio of 17.7. Shares are up 22.2% year to date as of the close of trading on Wednesday. Currently there are 11 analysts that rate Morgan Stanley a buy, two analysts rate it a sell, and seven rate it a hold.

TheStreet Ratings rates Morgan Stanley as a buy. The company's strengths can be seen in multiple areas, such as its increase in stock price during the past year, attractive valuation levels, good cash flow from operations and notable return on equity. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

On the positive front, SP Bancorp ( SPBC), up 10.6%, Consumer Portfolio Services ( CPSS), up 7.1%, Federal Agricultural Mortgage ( AGM.A), up 4.7%, and Blackstone Group ( BX), up 4.5%, were all gainers within the financial services industry with CIT Group ( CIT) being today's featured financial services industry leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the financial services industry could consider Financial Select Sector SPDR ( XLF) while those bearish on the financial services industry could consider Proshares Short Financials ( SEF).

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