🐂 Not all bull runs are created equal. November’s AI picks include 5 stocks up +20% eachUnlock Stocks

Morgan Stanley cites real estate challenges in DWS Group stock downgrade

EditorEmilio Ghigini
Published 18-07-2024, 03:20 pm
DWSG
-

On Thursday, Morgan Stanley (NYSE:MS) adjusted its stance on DWS Group GmbH & Co KGaA (DWS:GR), downgrading the stock from Overweight to Equalweight. The firm also revised its price target downward to EUR 42.00 from the previous EUR 46.60. The change in rating reflects a reassessment of the risk/reward profile for DWS Group, considering recent developments and future expectations.

According to the firm, the decision comes after the completion of DWS's €800 million excess capital return. Additionally, Morgan Stanley anticipates ongoing challenges within DWS's Real estate franchise. The analyst also pointed to expected lower margin outflows for the second quarter of 2024, as indicated during the company's Annual General Meeting (AGM).

Despite these concerns, the analyst acknowledged the continued success of DWS's ETF business, which has been benefiting from the demand for lower cost beta products. However, the recalibration of the price target is based on a reduced target multiple of 9 times the estimated earnings for 2025. This adjustment aligns DWS Group's valuation with the current average of the European sector.

The new price target of EUR 42.00, despite being lower than the previous target, still suggests a potential upside of approximately 25% from the current levels. This estimation is based on the firm's projections and the recent performance of the stock within the market.

In summary, Morgan Stanley's revised outlook on DWS Group balances the positive impacts from the ETF segment against the headwinds facing other parts of the business. The firm's analysis indicates a more neutral position on the stock's future performance potential.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.