Will Morgan Stanley (MS) Gain on Rising Earnings Estimates?

Morgan Stanley (MS) could be a solid choice for investors given the company's remarkably improving earnings outlook. While the stock has been a strong performer lately, this trend might continue since analysts are still raising their earnings estimates for the company.The rising trend in estimate revisions, which is a result of growing analyst optimism on the earnings prospects of this investment bank, should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. Our stock rating tool -- the Zacks Rank -- is principally built on this insight.The five-grade Zacks Rank system, which ranges from a Zacks Rank #1 (Strong Buy) to a Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record of outperformance, with Zacks #1 Ranked stocks generating an average annual return of +25% since 2008.Consensus earnings estimates for the next quarter and full year have moved considerably higher for Morgan Stanley, as there has been strong agreement among the covering analysts in raising estimates.The chart below shows the evolution of forward 12-month Zacks Consensus EPS estimate:12 Month EPSCurrent-Quarter Estimate RevisionsFor the current quarter, the company is expected to earn $2.27 per share, which is a change of +2.3% from the year-ago reported number.Over the last 30 days, four estimates have moved higher for Morgan Stanley compared to no negative revisions. As a result, the Zacks Consensus Estimate has increased 8.54%.Current-Year Estimate RevisionsFor the full year, the earnings estimate of $9.42 per share represents a change of +18.5% from the year-ago number.In terms of estimate revisions, the trend for the current year also appears quite encouraging for Morgan Stanley. Over the past month, five estimates have moved higher compared to no negative revisions, helping the consensus estimate increase 6.29%.Favorable Zacks RankThanks to promising estimate revisions, Morgan Stanley currently carries a Zacks Rank #1 (Strong Buy). The Zacks Rank is a tried-and-tested rating tool that helps investors effectively harness the power of earnings estimate revisions and make the right investment decision.You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.Our research shows that stocks with Zacks Rank #1 (Strong Buy) and 2 (Buy) significantly outperform the S&P 500.Bottom LineWhile strong estimate revisions for Morgan Stanley have attracted decent investments and pushed the stock 6.4% higher over the past four weeks, further upside may still be left in the stock. So, you may consider adding it to your portfolio right away.Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Morgan Stanley (MS): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks