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Morgan Stanley (MEX:MS) Piotroski F-Score

: 2 (As of Today)
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Warning Sign:

Piotroski F-Score of 2 is low, which usually implies poor business operation.

The zones of discrimination were as such:

Good or high score = 7, 8, 9
Bad or low score = 0, 1, 2, 3

Morgan Stanley has an F-score of 3. It is a bad or low score, which usually implies poor business operation.

The historical rank and industry rank for Morgan Stanley's Piotroski F-Score or its related term are showing as below:

MEX:MS' s Piotroski F-Score Range Over the Past 10 Years
Min: 2   Med: 4   Max: 8
Current: 2

During the past 13 years, the highest Piotroski F-Score of Morgan Stanley was 8. The lowest was 2. And the median was 4.


Morgan Stanley Piotroski F-Score Historical Data

The historical data trend for Morgan Stanley's Piotroski F-Score can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Morgan Stanley Annual Data
Trend Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22
Piotroski F-Score
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 8.00 7.00 5.00 7.00 2.00

Morgan Stanley Quarterly Data
Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22
Piotroski F-Score Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 7.00 5.00 5.00 4.00 2.00

Competitive Comparison

For the Capital Markets subindustry, Morgan Stanley's Piotroski F-Score, along with its competitors' market caps and Piotroski F-Score data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

Morgan Stanley Piotroski F-Score Distribution

For the Capital Markets industry and Financial Services sector, Morgan Stanley's Piotroski F-Score distribution charts can be found below:

* The bar in red indicates where Morgan Stanley's Piotroski F-Score falls in comparison to its industry or sector. The grey bar indicates the Piotroski F-Score's extreme value range as defined by GuruFocus.


How is the Piotroski F-Score calculated?

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

This Year (Dec22) TTM:Last Year (Dec21) TTM:
Net Income was 75315.770458544 + 49925.199544769 + 52821.344761839 + 43858.692815277 = MXN221,921 Mil.
Cash Flow from Operations was 4910.1116038167 + 298410.62156759 + -151580.40159049 + -274528.74089562 = MXN-122,788 Mil.
Revenue was 285957.50382228 + 245203.76561988 + 243616.376924 + 233376.89048129 = MXN1,008,155 Mil.
Average Total Assets from the begining of this year (Dec21)
to the end of this year (Dec22) was
(24863017.619389 + 25110043.664719 + 23487375.158662 + 23280505.981281 + 23149995.026864) / 5 = MXN23978187.490183 Mil.
Total Assets at the begining of this year (Dec21) was MXN24,863,018 Mil.
Long-Term Debt & Capital Lease Obligation was MXN4,728,756 Mil.
Total Assets was MXN23,149,995 Mil.
Total Liabilities was MXN21,164,369 Mil.
Net Income was 85489.999972216 + 70330.245332107 + 74310.89276008 + 77342.495935883 = MXN307,474 Mil.

Revenue was 307286.74990013 + 279718.46932998 + 279202.08102573 + 286958.23776211 = MXN1,153,166 Mil.
Average Total Assets from the begining of last year (Dec20)
to the end of last year (Dec21) was
(22273051.868752 + 24044518.992186 + 23272580.654534 + 23864400.962894 + 24863017.619389) / 5 = MXN23663514.019551 Mil.
Total Assets at the begining of last year (Dec20) was MXN22,273,052 Mil.
Long-Term Debt & Capital Lease Obligation was MXN4,872,222 Mil.
Total Assets was MXN24,863,018 Mil.
Total Liabilities was MXN22,632,348 Mil.

*Note: If the latest quarterly/semi-annual/annual total assets data is 0, then we will use previous quarterly/semi-annual/annual data for all the items in the balance sheet.

Profitability

Question 1. Return on Assets (ROA)

Net income before extraordinary items for the year divided by Total Assets at the beginning of the year.

Score 1 if positive, 0 if negative.

Morgan Stanley's current Net Income (TTM) was 221,921. ==> Positive ==> Score 1.

Question 2. Cash Flow Return on Assets (CFROA)

Net cash flow from operating activities (operating cash flow) divided by Total Assets at the beginning of the year.

Score 1 if positive, 0 if negative.

Morgan Stanley's current Cash Flow from Operations (TTM) was -122,788. ==> Negative ==> Score 0.

Question 3. Change in Return on Assets

Compare this year's return on assets (1) to last year's return on assets.

Score 1 if it's higher, 0 if it's lower.

ROA (This Year)=Net Income/Total Assets (Dec21)
=221921.00758043/24863017.619389
=0.00892575

ROA (Last Year)=Net Income/Total Assets (Dec20)
=307473.63400029/22273051.868752
=0.01380474

Morgan Stanley's return on assets of this year was 0.00892575. Morgan Stanley's return on assets of last year was 0.01380474. ==> Last year is higher ==> Score 0.

Question 4. Quality of Earnings (Accrual)

Compare Cash flow return on assets (2) to return on assets (1)

Score 1 if CFROA > ROA, 0 if CFROA <= ROA.

Morgan Stanley's current Net Income (TTM) was 221,921. Morgan Stanley's current Cash Flow from Operations (TTM) was -122,788. ==> -122,788 <= 221,921 ==> CFROA <= ROA ==> Score 0.

Funding

Question 5. Change in Gearing or Leverage

Compare this year's gearing (long-term debt divided by average total assets) to last year's gearing.

Score 0 if this year's gearing is higher, 1 otherwise.

Gearing (This Year: Dec22)=Long-Term Debt & Capital Lease Obligation/Average Total Assets from Dec21 to Dec22
=4728755.6004471/23978187.490183
=0.19721072

Gearing (Last Year: Dec21)=Long-Term Debt & Capital Lease Obligation/Average Total Assets from Dec20 to Dec21
=4872221.5019609/23663514.019551
=0.20589594

Morgan Stanley's gearing of this year was 0.19721072. Morgan Stanley's gearing of last year was 0.20589594. ==> This year is lower or equal to last year. ==> Score 1.

Question 6. Change in Working Capital (Liquidity)

Compare this year's current ratio (current assets divided by current liabilities) to last year's current ratio.

Score 1 if this year's current ratio is higher, 0 if it's lower

* Note that for banks and insurance companies, there's no Total Current Assets and Total Current Liabilities reported. Thus, we use Total Assets and Total Liabilities to calculate current ratio for banks and insurance companies.

Current Ratio (This Year: Dec22)=Total Assets/Total Liabilities
=23149995.026864/21164369.207372
=1.09381928

Current Ratio (Last Year: Dec21)=Total Assets/Total Liabilities
=24863017.619389/22632347.873238
=1.09856113

Morgan Stanley's current ratio of this year was 1.09381928. Morgan Stanley's current ratio of last year was 1.09856113. ==> Last year's current ratio is higher ==> Score 0.

Question 7. Change in Shares in Issue

Compare the number of shares in issue this year, to the number in issue last year.

Score 0 if there is larger number of shares in issue this year, 1 otherwise.

Morgan Stanley's number of shares in issue this year was 1677. Morgan Stanley's number of shares in issue last year was 1784. ==> There is smaller number of shares in issue this year, or the same. ==> Score 1.

Efficiency

Question 8. Change in Gross Margin

Compare this year's gross margin (Gross Profit divided by sales) to last year's.

Score 1 if this year's gross margin is higher, 0 if it's lower.

* Note that for banks and insurance companies, there's no Gross Profit reported. Thus, we use net income instead of gross profit and calculate Net Margin for this score.

Net Margin (This Year: TTM)=Net Income/Revenue
=221921.00758043/1008154.5368474
=0.22012598

Net Margin (Last Year: TTM)=Net Income/Revenue
=307473.63400029/1153165.538018
=0.26663443

Morgan Stanley's net margin of this year was 0.22012598. Morgan Stanley's net margin of last year was 0.26663443. ==> Last year's net margin is higher ==> Score 0.

Question 9. Change in asset turnover

Compare this year's asset turnover (total sales for the year divided by total assets at the beginning of the year) to last year's asset turnover ratio.

Score 1 if this year's asset turnover ratio is higher, 0 if it's lower

Asset Turnover (This Year)=Revenue/Total Assets at the Beginning of This Year (Dec21)
=1008154.5368474/24863017.619389
=0.04054836

Asset Turnover (Last Year)=Revenue/Total Assets at the Beginning of Last Year (Dec20)
=1153165.538018/22273051.868752
=0.05177402

Morgan Stanley's asset turnover of this year was 0.04054836. Morgan Stanley's asset turnover of last year was 0.05177402. ==> Last year's asset turnover is higher ==> Score 0.

Evaluation

Piotroski F-Score= Que. 1+ Que. 2+ Que. 3+Que. 4+Que. 5+Que. 6+Que. 7+Que. 8+Que. 9
=1+0+0+0+1+0+1+0+0
=3

Good or high score = 7, 8, 9
Bad or low score = 0, 1, 2, 3

Morgan Stanley has an F-score of 3. It is a bad or low score, which usually implies poor business operation.

Morgan Stanley  (MEX:MS) Piotroski F-Score Explanation

The developer of the system is Joseph D. Piotroski is relatively unknown accounting professor who shuns publicity and rarely gives interviews.

He graduated from the University of Illinois with a B.S. in accounting in 1989, received an M.B.A. from Indiana University in 1994. Five years later, in 1999, after earning a Ph.D. in accounting from the University of Michigan, he became an associate professor of accounting at the University of Chicago.

In 2000, he wrote a research paper called "Value Investing: The Use of Historical Financial Statement Information to Separate Winners from Losers" (pdf).

He wanted to see if he can develop a system (using a simple nine-point scoring system) that can increase the returns of a strategy of investing in low price to book (referred to in the paper as high book to market) value companies.

What he found was something that exceeded his most optimistic expectations.

Buying only those companies that scored highest (8 or 9) on his nine-point scale, or F-Score as he called it, over the 20 year period from 1976 to 1996 led to an average out-performance over the market of 13.4%.

Even more impressive were the results of a strategy of investing in the highest F-Score companies (8 or 9) and shorting companies with the lowest F-Score (0 or 1).

Over the same period from 1976 to 1996 (20 years) this strategy led to an average yearly return of 23%, substantially outperforming the average S&P 500 index return of 15.83% over the same period.


Morgan Stanley Piotroski F-Score Related Terms

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Morgan Stanley (MEX:MS) Business Description

Morgan Stanley logo
Address
1585 Broadway, New York, NY, USA, 10036
Morgan Stanley is a global investment bank whose history, through its legacy firms, can be traced back to 1924. The company has institutional securities, wealth management, and investment management segments. The company had about $5 trillion of client assets as well as over 70,000 employees at the end of 2021. Approximately 50% of the company's net revenue is from its institutional securities business, with the remainder coming from wealth and investment management. The company derives about 30% of its total revenue outside the Americas.

Morgan Stanley (MEX:MS) Headlines