S&P 500   3,585.62
DOW   28,725.51
QQQ   267.26
Why This Bear Market Is Not Even Close to Being Done…
In 20 years, this little-known trader didn’t have a single losing year… (Ad)
Denmark says Nord Stream 1 pipelines stop leaking
Denmark says Nord Stream 1 natural gas pipeline has also stopped leaking
In 20 years, this little-known trader didn’t have a single losing year… (Ad)
Brazil holds historic election with Lula against Bolsonaro
US shift away from coal hits tribal community in New Mexico
In 20 years, this little-known trader didn’t have a single losing year… (Ad)
Tesla sales bounce back in Q3 but fall short of estimates
UK's Truss sticks by economic plan as her party worries
S&P 500   3,585.62
DOW   28,725.51
QQQ   267.26
Why This Bear Market Is Not Even Close to Being Done…
In 20 years, this little-known trader didn’t have a single losing year… (Ad)
Denmark says Nord Stream 1 pipelines stop leaking
Denmark says Nord Stream 1 natural gas pipeline has also stopped leaking
In 20 years, this little-known trader didn’t have a single losing year… (Ad)
Brazil holds historic election with Lula against Bolsonaro
US shift away from coal hits tribal community in New Mexico
In 20 years, this little-known trader didn’t have a single losing year… (Ad)
Tesla sales bounce back in Q3 but fall short of estimates
UK's Truss sticks by economic plan as her party worries
S&P 500   3,585.62
DOW   28,725.51
QQQ   267.26
Why This Bear Market Is Not Even Close to Being Done…
In 20 years, this little-known trader didn’t have a single losing year… (Ad)
Denmark says Nord Stream 1 pipelines stop leaking
Denmark says Nord Stream 1 natural gas pipeline has also stopped leaking
In 20 years, this little-known trader didn’t have a single losing year… (Ad)
Brazil holds historic election with Lula against Bolsonaro
US shift away from coal hits tribal community in New Mexico
In 20 years, this little-known trader didn’t have a single losing year… (Ad)
Tesla sales bounce back in Q3 but fall short of estimates
UK's Truss sticks by economic plan as her party worries
S&P 500   3,585.62
DOW   28,725.51
QQQ   267.26
Why This Bear Market Is Not Even Close to Being Done…
In 20 years, this little-known trader didn’t have a single losing year… (Ad)
Denmark says Nord Stream 1 pipelines stop leaking
Denmark says Nord Stream 1 natural gas pipeline has also stopped leaking
In 20 years, this little-known trader didn’t have a single losing year… (Ad)
Brazil holds historic election with Lula against Bolsonaro
US shift away from coal hits tribal community in New Mexico
In 20 years, this little-known trader didn’t have a single losing year… (Ad)
Tesla sales bounce back in Q3 but fall short of estimates
UK's Truss sticks by economic plan as her party worries

Should You Have These Two Banks In Your Portfolio?

Should You Have These Two Banks In Your Portfolio?Despite the stock market theory saying that banks should benefit from a rising interest rate environment, it has been one of the tougher years in recent memory for the financial sector. The iShares US Financial ETF (NYSEARCA: IYF) is down 25% from the all-time high it tagged back in January and is in fact now below its pre-pandemic level. 

It’s fair to say that Wall Street banks are struggling with a collapse in IPOs and debt and equity issuance this year, which is a complete reversal from the market environment that drove stellar results last year. The change has been triggered by broad declines in financial assets, increasing pessimism over the possibility of a recession and the Russian invasion of Ukraine.

But does that mean investors should stay away indefinitely or are there potential opportunities starting to open up in individual names? With fresh earnings after being released let’s take a look at two of the bigger names on Wall Street and see if there’s enough long term potential to justify a starting position

Morgan Stanley (NYSE: MS)

Morgan Stanley shares are down more than 30% from their February high and in fact set a fresh low yesterday morning before recovering into the close. The volatility was driven by the release of their Q2 earnings which came out before the bell rang to start the session. Both topline revenue and bottom line EPS missed expectations, the former contracting 11.5% year over year. 


It wasn’t exactly the surprise beat investors would have been hoping for, and with shares already at 52 week lows you’d have to be thinking there’s a good chance this will sink them further. The bank’s results were hurt by a steep 55% decline in investment banking revenue. This confirmed what some analysts had feared for Morgan Stanley, which runs one of the larger equity capital markets operations on Wall Street.

But there are signs that we’re nearing capitulation and for those of us with a long enough investment horizon it’s worth taking note of the underlying strength still in play at Morgan Stanley. Management saw fit to raise the quarterly dividend by 11%, hardly the move of a company that sees things getting worse. On the contrary, this is considered one of the most bullish signals a company can give to the market. Is Morgan Stanley telling investors it's time to start backing up the truck?
Should You Have These Two Banks In Your Portfolio?

JPMorgan (NYSE: JPM)

JPMorgan has had an even rougher first half of 2022 than its cousin across the street, with shares down almost 40% from their high last October. But what’s interesting here is they were recently upgraded to full Buy rating by the team over at Citi. 

Earlier this week, Citigroup analyst Keith Horowitz upgraded them as he sees an unrecognized upside potential on its EPS while the stock no longer reflects a premium valuation. In a note to clients he wrote that "we believe investors will first look to high-quality franchises with strong management teams and a sound balance sheet, and we believe JPM fits this narrative." 

The move and bullish comments will go some way to offsetting the company’s poor results from yesterday, which missed analyst expectations for both quarterly revenue and earnings per share. At least the bank’s revenue was able to move in the right direction, registering a small increase year on year compared to Morgan Stanley’s which shrank. Still, considering the stock is close to new lows, investors getting involved are going to have to be wary about trying to catch a falling knife. Another 10% lower will see JPMorgan shares trading at the level they held during the depths of the pandemic sell-off in 2020, and it’s hard to see them give that up without a fight. If you were to pick a moment to really go for it, it is around now when they’re on the verge of what could well be final capitulation.
Should You Have These Two Banks In Your Portfolio?

Companies Mentioned in This Article

CompanyMarketRank™Current PricePrice ChangeDividend YieldP/E RatioConsensus RatingConsensus Price Target
Morgan Stanley (MS)
3.4157 of 5 stars
$79.01-1.1%3.92%10.68Moderate Buy$99.75
JPMorgan Chase & Co. (JPM)
3.392 of 5 stars
$104.50-1.6%3.83%8.39Moderate Buy$145.95
Compare These Stocks  Add These Stocks to My Watchlist 

Should you invest $1,000 in Morgan Stanley right now?

Before you consider Morgan Stanley, you'll want to hear this.

MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Morgan Stanley wasn't on the list.

While Morgan Stanley currently has a "Moderate Buy" rating among analysts, top-rated analysts believe these five stocks are better buys.

View The Five Stocks Here

Sam Quirke

About Sam Quirke

Contributing Author: Technical Analysis

After graduating with a degree in finance, Sam worked for a trading technology company as an analyst before joining a prop firm. Here he traded energy, commodity and index futures while utilizing a combination of technical and fundamental analysis.Today he manages his own stock and option portfolio which is made up of longer term positions and shorter term momentum plays. He lives in Chicago.
Contact Sam Quirke via email at s.quirke.us@gmail.com.
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