Nomura Securities Maintains a 'Neutral' on Morgan Stanley (MS); Q3 Review

Nomura Securities maintains a 'Neutral' on Morgan Stanley (NYSE: MS) price target of $20.00.

Nomura analyst, Glenn Schorr, said, "EPS of $1.14 from Continuing Ops vs. Our/Street ests of $0.25/$0.30. Ex DVA of $3.4bn (a recurring theme this quarter), EPS was +$0.02 vs. our/consensus estimates of around a -$0.10. Adjusting for some other items in the quarter, we get to “core” EPS of around $0.22. While this is better than the $0.02 reported number, a 3% ROE is nothing to get too excited about. That said, we think Morgan performed reasonably well given the difficult macro backdrop with solid trading results versus peers (equity trading - 26% q/q ex DVA, FICC -43% ex DVA, or -4% ex DVA and MBIA gains/losses), very healthy net inflows of $15.5 billion in global wealth management, and Morgan’s investment banking franchise continues to rank highly in the M&A and equity league tables. We adjust our 2011E EPS from $0.76 to $1.55, 2012E from $2.00 to $1.75, and 2013E from $2.30 to $2.20."

For more ratings news on Morgan Stanley click here and for the rating history of Morgan Stanley click here.

Shares of Morgan Stanley closed at $16.64 yesterday.

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