Morgan Stanley (MS.N): 2Q26 Review - Multiple Growth Engines With Equities Driving Estimates Higher; Raise PT to $235

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Morgan Stanley (MS.N): 2Q26 Review - Multiple Growth Engines With Equities Driving Estimates Higher; Raise PT to $235

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17 Jul 2026 05:00:42 ET │ 15 pages

Morgan Stanley (MS.N)

2Q26 Review -Multiple Growth Engines With Equities Driving Estimates

Higher; Raise PT to $235

CITI'S TAKE Neutral

Price (16 Jul 26 16:00) US$218.37MS lagged on earnings day (up ~0.4% vs BKX up 1.5%), though we think

Target price US$235.00↑ much of the reaction was captured in the prior day's relative

outperformance (up ~3% vs BKX up ~1%) following strong read-through from US$220.00

from peers. The strong print and constructive commentary reinforces that Expected share price return 7.6%

the environment remains highly supportive for capital markets. While we Expected dividend yield 2.2%

remain more confident in the sustainability in banking revenues given Expected total return 9.8%

strong backlogs, equities trading revenues appear to have shifted Market Cap US$343,278M

structurally higher and with Asia a key driver of client activity, MS is among

best-positioned given its global franchise. WM only adds to the durability

of MS' revenue profile and stands to benefit from stronger IPO activity to

be captured in their client asset mousetrap. We raise estimates higher Benjamin GerlingerAC

largely on stronger equities with returns at 23%+ through '27 even despite +1-212-816-3538

the drag of substantial excess capital, and raise PT to $235 on improved benjamin.gerlinger@citi.com

return outlook. Mikhail Mrotchek

+1-212-816-2345

Estimate Changes — Our 2026E EPS increases $1.40 to $13.65 (vs. FactSet misha.mrotchek@citi.com

consensus of $12.49), 2027E EPS increases $1.05 to $13.70 (vs. FactSet consensus Kaili Wang, CFA

of $13.28), and 2028E EPS increases 80c to $14.35. See Figure 1 for more detail on