The investment bank has chosen four companies it recommends investing in, each operating in strategic sectors and with a clear vision for the future.
With uncertainty dominating global markets, October could be a month of turbulence or calm. Against this backdrop, Morgan Stanley has identified a number of stocks that, despite the economic turmoil, show strength and long-term growth potential.
The investment bank has chosen four companies to bet on, each operating in strategic sectors and with a clear vision for the future.
Each of these companies represents a unique opportunity for investors, thanks to their ability to adapt, innovate, and grow in an ever-changing environment.
Below, is an in-depth analysis of why Morgan Stanley is bullish on these stocks.
Lineage Logistics
Lineage Logistics, a leading company in the cold storage sector, has been a focus of analyst Ronald Kamdem. Morgan Stanley has strengthened its bullish stance on the company after a series of meetings with management, despite recent data showing a reduction in overall cold storage inventories.
Kamdem stressed that while inventory in the cold storage sector has decreased, Lineage still sees ample room for growth. “This is one of the more optimistic comments that came out of the meetings,” the analyst said, suggesting that there are several avenues for both internal and external expansion that will ensure sustained growth in the medium term. In particular, the company is positioned as a key player in the mergers and acquisitions space, with the potential to close deals worth between $500 million and $1 billion annually over the next three to five years.
With a 33% market share in the United States and 12% globally, Lineage is seen as the go-to acquirer in its sector. Despite the stock losing 7% over the past month, Morgan Stanley reiterated its “overweight” recommendation and keeps Lineage as one of its top picks, considering it too attractive to ignore.
Thermo Fisher Scientific
Thermo Fisher Scientific, a leading medical technology company, is another strategic pick for Morgan Stanley. Analyst Tejas Savant and his team praised the company’s consistency and strength in the business model, especially in an uncertain economic environment. During the recent “Analyst Day,” Morgan Stanley expressed confidence in Thermo Fisher’s ability to maintain robust growth through 2025.
Although global growth, especially in China, has temporarily slowed, Savant expressed optimism that economic stimulus in China will soon improve growth prospects. The stock has already rallied 13% in 2024, but Morgan Stanley believes there is still room for further gains. The team praised the company’s operational resilience, ability to navigate mergers and acquisitions, and competitive advantage in the industry.
M&T Bank
M&T Bank, a Buffalo-based regional bank, has caught the eye of analyst Manan Gosalia, who sees it as one of the most promising bank stocks. After a series of meetings with executives, Morgan Stanley highlighted several positive catalysts for the bank, including improving credit metrics, solid loan growth, lower funding costs, and accelerating capital returns.
Another key factor for M&T Bank’s future will be the impact of the Federal Reserve’s interest rate cut. The bank expects lower rates to help improve its commercial real estate lending portfolio, reducing investor perceptions of risk and lowering capital requirements. Although the stock is up 30% this year, Morgan Stanley believes M&T is still undervalued, with plenty of room for improvement in both earnings growth and multiple revisions.
Taiwan Semiconductor
Taiwan Semiconductor, a leading semiconductor company, remains one of Morgan Stanley’s top picks in Asia. The company is in a strong growth phase and is well-positioned to maintain a 15-20% compound annual revenue growth rate (CAGR) over the next five years, according to the bank.
Management recently confirmed that its capacity expansion is on track to achieve this goal, supported by its strong equipment supply chain. Morgan Stanley believes that Taiwan Semiconductor’s long-term growth prospects and gross margin expansion make it a particularly attractive choice among Asian stocks, with a price/earnings (P/E) multiple of 18x expected for 2025, which looks very attractive.
|Disclaimer
The information and considerations contained in this article should not be used as the sole and primary basis for making investment decisions. The reader retains full freedom in his or her investment choices and full responsibility in making them, since only he or she knows his or her risk appetite and time horizon. The information contained in the article is provided for information purposes only and its disclosure does not constitute and should not be considered an offer or solicitation to the public.|
Original article published on Money.it Italy 2024-10-20 14:15:00. Original title: 4 titoli da comprare il prima possibile secondo Morgan Stanley
