Giles Coghlan LLB, Lth, MA
Financial Source
Morgan Stanley releases its earnings results today. How will the stock respond? Rising interest rates are generally a positive environment for financial stock as higher rates usually mean higher profit margins for bank loan charges.
In this earnings season, there is a focus on the bank’s net interest income reports. This is the difference between what the bank’s revenue from interest-bearing assets is and the cost of servicing these assets. Investors want to make sure that debt default expectations don’t rise rapidly to assess how healthy bank’s earnings really are.
What are the seasonals like for Morgan Stanley? Well, they are quite mixed. At first sight, they look good, but when you take out an outlier result post-2019 you see some pretty indifferent results. So, does this mean Morgan Stanley is worth passing over this earnings season? Or will the actual results reveal some hidden value?
Major trade risks: The main risk here is if Morgan Stanley surprises with some good results that can cause investors to buy into the stock.
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