Morgan Stanley Financial Analysis

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Submitted By andrewspanos
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Morgan Stanley (MS)

* Describe the nature of this company’s business according to the Annual Report.
Morgan Stanley is a financial services holding company that operates on a global basis through its subsidiaries and affiliates to maintain a competitive market position within its business segments. The three segments MS primarily positions itself in are the following: Institutional Securities, Global Wealth Management Group, and Asset Management. MS provides these services to a wide and varying client base consisting of governments, individuals, and almost everything in between. (p 50) * Was that description of business in line with what you thought the company’s main business was before reading the MD&A?
Yes, it was in line with what I thought MS, and their subsidiaries business interests were involved with. I was however unaware that the Global Wealth Management Group position of MS made up 65% of the company’s operating interest. * List five positive events (outcomes) mentioned in the MD&A. What is the source of/reasons for these positive things? Were those things good/positive due to management’s effort or due to external factors? In other words, who should/did take credit for these good things? 1. Morgan Stanley’s DVA income increased from 2011 to 2012 by $721 million. This can be considered a positive event because the decrease in the company’s liabilities is in a sense, a source of profit. (p 58) 2. Global Wealth Management Group reported an increase in EBIT of $345 million. (p 59) 3. Asset Management reported an increase in EBIT from the previous year of $337 million (p 59) 4. MS reported an income of $152 million for 2012 in comparison to a $783 million loss in it’s Japanese securities joint venture. (p 60) 5. An aggregate net tax benefit of $ 142 million was reported for 2012 when compared to the…...

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