5 Best Undervalued Stocks According to Hedge Funds

In this article, we discuss the 5 best undervalued stocks according to hedge funds. If you want to read our detailed analysis of these stocks, go directly to the 10 Best Undervalued Stocks According to Hedge Funds. 

5. Morgan Stanley (NYSE:MS)

Number of Hedge Fund Holders: 65

PE Ratio: 11.88   

Morgan Stanley (NYSE:MS) is a New York-based financial services firm. It is one of the most popular finance stocks on Wall Street. At the end of the fourth quarter of 2021, 65 hedge funds in the database of Insider Monkey held stakes worth $4.5 billion in Morgan Stanley (NYSE:MS), the same as in the preceding quarter worth $4.9 billion.

On January 3, Barclays analyst Jason Goldberg maintained an Overweight rating on Morgan Stanley (NYSE:MS) stock and raised the price target to $123 from $110, noting that the bank was poised to outperform the market in 2022 as loan growth accelerates and net interest margins benefit from higher interest rates.

In its Q1 2021 investor letter, Artisan Partners Limited Partnership, an asset management firm, highlighted a few stocks and Morgan Stanley (NYSE:MS) was one of them. Here is what the fund said:

“Top three contributor Morgan Stanley, a leading global financial services company, came into the portfolio in Q4 as a result of its purchase of E*TRADE. E*TRADE is a great fit on Morgan Stanley’s wealth management platform and provides a considerable amount of non-interest-bearing deposit funding. James Gorman, chairman and CEO, has steadily de-risked Morgan Stanley’s business by adding less volatile fee streams and deemphasizing the risk-obtuse culture of prior management. We believe the market will come to appreciate this mix shift over time.”