Morgan Stanley adjusts its US Model portfolio

Investing.com
Updated Jun 21, 2024 02:52
Mitrade
coverImg
Source: DepositPhotos

Investing.com - In a strategy update released on Thursday,  Morgan Stanley  (NYSE:MS) made significant alterations to its US Model Portfolio.


The changes include adding   Cummins Inc   (NYSE:CMI) due to its cyclical leverage to improving order rates in transportation end markets and potential secular tailwinds from power generation demand due to advancements in artificial intelligence (AI).


They have also decided to remove QUALCOMM Inc (QCOM) as they believe the company's valuation effectively prices the underlying improvement in cyclical end markets and Edge AI opportunity.

⚠️Track your favorite companies with InvestingPro! CLICK HERE to take advantage and accelerate your investments!⚠️

Cummins Inc (CMI) has been added to the portfolio for three main reasons. Firstly, CMI offers cyclical leverage from improvements in transportation end markets.


Secondly, its exposure to the "powering Gen AI" theme provides secular growth tailwinds. Lastly, Morgan Stanley believes CMI trades at a reasonable valuation. As a large provider of power generation equipment, CMI is expected to benefit from increased content and structural demand tailwinds.


Morgan Stanley is removing QUALCOMM Inc (QCOM) from its portfolio as they believe the company's valuation effectively prices the underlying improvement in cyclical end markets and Edge AI opportunity. Since its addition to the portfolio in March 2021, QCOM has gained 83%, outperforming the S&P 500 benchmark which was up by 46% over the same period.


In addition to these changes, Morgan Stanley has also made risk management-driven adjustments to its portfolio. It has increased its internally held portfolio weights in Apple Inc (NASDAQ:AAPL), Tesla Inc (NASDAQ:TSLA), TransDigm Inc (TDG),   Exxon Mobil   Corp (NYSE:XOM), NVIDIA Corp (NASDAQ:NVDA), Becton Dickinson & Co (NYSE:BDX), and decreased its internally held portfolio weights in BlackRock Inc (NYSE:BLK),   Visa Inc   (NYSE:V).


These changes reflect Morgan Stanley's ongoing efforts to provide optimal returns for their clients, adjusting their strategies based on market trends and company performance. They highlight the importance of maintaining a well-balanced portfolio that is responsive to both cyclical and secular market trends.

* The content presented above, whether from a third party or not, is considered as general advice only.  This article should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments.

Do you find this article useful?
Related Articles
placeholder
Asian stocks fall as US-China jitters persist; TSMC sparks little cheerInvesting.com-- Most Asian stocks fell on Friday amid persistent concerns over a renewed trade war between the U.S. and China, while positive earnings from TSMC did little to stop a rout in technology stocks.
Author  Investing.com
Investing.com-- Most Asian stocks fell on Friday amid persistent concerns over a renewed trade war between the U.S. and China, while positive earnings from TSMC did little to stop a rout in technology stocks.
placeholder
Wedbush says Palantir stock could nearly double from here. Here's howWedbush analysts issued a bullish outlook for Palantir Technologies Inc . (NYSE:PLTR) in a note Thursday, suggesting the stock could nearly double in value. They cite Palantir's central role in the AI revolution and expanding use cases for its products as key drivers of future growth.
Author  Investing.com
Wedbush analysts issued a bullish outlook for Palantir Technologies Inc . (NYSE:PLTR) in a note Thursday, suggesting the stock could nearly double in value. They cite Palantir's central role in the AI revolution and expanding use cases for its products as key drivers of future growth.
placeholder
Avoid this group of chip stocks as the US election approaches: CitiThe broader U.S. equity market saw a sell-off on Wednesday, dragging the Nasdaq 2.8% and the S&P 500 down 2.8% and 1.4%, respectively.The sell-off was led by a sharp pullback in the semiconductor sect
Author  Investing.com
The broader U.S. equity market saw a sell-off on Wednesday, dragging the Nasdaq 2.8% and the S&P 500 down 2.8% and 1.4%, respectively.The sell-off was led by a sharp pullback in the semiconductor sect
placeholder
DJT stock skyrockets 60% after Trump assassination attemptShares in Trump Media&Technology Group Corp (NASDAQ:DJT) skyrocketed in Monday's premarket trading following a dramatic weekend marked by what authorities are investigating as an assassination attempt on former U.S. President Donald Trump.
Author  Investing.com
Shares in Trump Media&Technology Group Corp (NASDAQ:DJT) skyrocketed in Monday's premarket trading following a dramatic weekend marked by what authorities are investigating as an assassination attempt on former U.S. President Donald Trump.
placeholder
Apple stock rises as Morgan Stanley names it Top Pick ahead of iPhone 16 launchApple (NASDAQ:AAPL) stock edged 2% higher in premarket trading Monday after Morgan Stanley (NYSE:MS) analysts upgraded it to a Top Pick and raised the price target from $216 to $273.
Author  Investing.com
Apple (NASDAQ:AAPL) stock edged 2% higher in premarket trading Monday after Morgan Stanley (NYSE:MS) analysts upgraded it to a Top Pick and raised the price target from $216 to $273.