‘More Pain Likely Ahead’: 5 Stocks to Brace Yourself for Recession

In this article, we discuss 5 stocks to brace yourself for recession. If you want to see more stocks in this selection and a detailed outlook on the current market, check out ‘More Pain Likely Ahead’: 10 Stocks to Brace Yourself for Recession. 

5. Morgan Stanley (NYSE:MS)

Number of Hedge Fund Holders: 61

Morgan Stanley (NYSE:MS) is an American multinational investment management and financial services holding company, operating through Institutional Securities, Wealth Management, and Investment Management segments. On April 14, the company posted its Q1 results, reporting earnings per share of $2.06 and a revenue of $14.80 billion, topping analysts’ estimates by $0.34 and $1.05 billion, respectively. Morgan Stanley (NYSE:MS) delivers a dividend yield of 3.28% as of June 8. 

On May 3, Oppenheimer analyst Chris Kotowski upgraded Morgan Stanley (NYSE:MS) to Outperform from Perform with a $111 price target, citing loan growth and rising interest rates as optimistic macro factors for banks. His valuation model suggests that Morgan Stanley (NYSE:MS) has 30%-plus upside potential in the 12-18 months ahead and he sees the weakness in shares as a buying opportunity. 

Among the hedge funds tracked by Insider Monkey, 61 funds were bullish on Morgan Stanley (NYSE:MS) at the end of March 2022, with collective stakes worth $3.25 billion. Boykin Curry’s Eagle Capital Management is the biggest position holder in the company, with more than 14 million shares worth $1.2 billion. 

Here is what Artisan Value Fund has to say about Morgan Stanley (NYSE:MS) in its Q3 2021 investor letter:

“Morgan Stanley, a leading global financial services company, came into the portfolio in late 2020 as a result of its purchase of E*TRADE. The acquisition is a great fit for 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 the business by adding less volatile fee streams to complement its leading positions in cyclical businesses such as advisory, equities and FICC (fixed income, currencies and commodities). We believe the company will prove its resiliency and value over the long term.”