We recently compiled a list of the 20 High Growth Mega Cap Stocks You Can Buy And Hold For Next 5 Years. In this article, we are going to take a look at where Morgan Stanley (NYSE:MS) stands against the other high growth mega cap stocks.

Exactly 5 years ago, the world struggled to deal with a black swan event: the COVID-19 pandemic. There was so much uncertainty that people didn’t even know if they’d be alive in the next few weeks, let alone figure out where the market was heading. Anyone who invested in the S&P 5 years ago would have gained 83%. If you had bought at the exact bottom, you’d have gained twice that amount.

What the above proves is that the present isn’t necessarily an indicator of what the future holds. All companies that had their workflows disrupted have recovered, some more than others. Some companies have strengthened their supply chains. Others have improved their work-from-home capabilities. Industries like airlines and restaurants have modified their business models to cater to the new dynamics.

These companies have been able to deal with the changing dynamics because of their financial strength and innovation. A company’s past performance and its finances give a good idea of whether it will be able to survive bad times. That’s why when we look at the best mega-cap stocks to hold for the next 5 years, we look at how well they have grown in the last 5 years.

To come up with our list of top 20 mega-cap stocks to hold for the next 5 years, we considered stocks with a market cap of at least $200 billion and a 5-year sales growth rate of at least 10%.

A panoramic view of a financial institution, representing the number of corporations who trust the company's services.

Morgan Stanley (NYSE:MS) 

Morgan Stanley (NYSE:MS) operates as a financial holding company and provides different financial services and products to individuals, governments, financial institutions, and corporations. It operates in three segments; wealth management, institutional securities, and investment management. The company has grown its revenue by 15.80% over the last 5 years.

Morgan Stanley (NYSE:MS) shareholders have a lot going their way at the moment. The company offers an attractive dividend yield at 2.81% with a dividend amount that has almost increased threefold in the last 5 years. The dividend strength is stronger than its peers by a long margin.

The only question investors should ask themselves when holding the stock for the next 5 years is if they’re overpaying for the stock today. The stock is at all-time highs and trades at a forward PE of 15.5 while the sector average is around 12. Yes, the stock is overvalued. However, with the Trump administration likely to be lenient on the banks in terms of regulation, 19 upward EPS revisions and a 100% YoY expected EPS growth rate, we believe the valuation is justified.

Overall MS ranks 17th on our list of the high growth mega cap stocks you can buy and hold for the next 5 years. While we acknowledge the potential of MS as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as MS but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

 

READ NEXT: 20 Best AI Stocks To Buy Now and Complete List of 59 AI Companies Under $2 Billion in Market Cap

 

Disclosure: None. This article was originally published at Insider Monkey.