Rochdale Securities Chief Analyst Richard Bove is none too happy with Morgan Stanley’s increased risk-taking and additions to staff, and he's letting everyone know it, saying in essence that unless the bank fails to dramatically shifts gears, it’s pretty much toast.
"In sum, it has not created a durable strategy nor has it executed with consistency," Bove wrote in a research note.
"This has resulted in an unstable work force and erratic earnings performance."
Bove also cited the timing of Morgan Stanley's forays into alternative investing and the housing market as examples of its questionable strategies.
Bove’s misgivings notwithstanding, he still rates Morgan Stanley as a “Buy” with a price target of $35 per share. He expects Morgan Stanley will lose 52 cents a share for the year and earn $3.54 a share in 2010.
Morgan Stanley is hiring retail bankers in Charlotte and New York, in a bid to "organically grow" a business aimed at Joe and Jane Lunchbucket, The Wall Street Journal reports.
Bank spokeswoman Christy Pollak says the firm is still finalizing its plans, but the firm's strategy is “to organically build rather than to acquire a retail bank,” to which end it will be “hiring individuals as we staff up our retail banking function.”
In November, Morgan Stanley hired former Wachovia executive Cece Sutton to run its retail bank and named colleague Jon Witter her chief operating officer.
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