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Morgan Stanley: UBS Sees 17.7% Upside Amidst Headwinds
7 Apr
Summary
- UBS upgraded Morgan Stanley to buy, citing resilience against market headwinds.
- Analyst highlights Morgan Stanley's history of tech adoption, including E-Trade acquisition.
- Morgan Stanley shares have fallen 6% year-to-date in 2026, underperforming the market.
UBS has upgraded Morgan Stanley to a 'buy' rating, predicting a potential 17.7% upside for its shares. This optimistic outlook comes despite recent market turbulence, including concerns over geopolitical events and the impact of AI.
Analyst Erika Najarian emphasized Morgan Stanley's historical agility in adopting new technologies. The firm's strategic acquisitions, like digital brokerage E-Trade for $13 billion in 2020 and Eaton Vance for deeper fixed-income and ESG exposure, demonstrate a willingness to innovate. The partnership with Zerohash in 2025 for crypto services further highlights this forward-thinking approach.
Morgan Stanley is also poised to benefit from upcoming banking deregulation, including changes to the Stress Capital Buffer framework. While peers have seen their stock prices reflect these regulatory shifts, UBS believes this has not yet been fully priced into Morgan Stanley's shares.
Despite shares falling 6% year-to-date in 2026, underperforming the broader market, Morgan Stanley has slightly outperformed competitors like JPMorgan Chase and Bank of America, which have seen declines of over 8%. UBS suggests Morgan Stanley may consistently outperform its medium-term targets, similar to JPMorgan Chase's strategy.
