The year 2023 began with a strong rally in the markets, but in the past month, positive sentiments have started to sputter. However, according to Mike Wilson, the chief US equity strategist at Morgan Stanley, what we are seeing now may herald the beginning of the end of the bear market. The market may be volatile, but Wilson describes a positive set-up for investors looking to hold stocks for the long-term. The stock analysts at Morgan Stanley are following Wilson’s lead and pointing out the equities that offer solid opportunities for the long-term. In this article, we will look at three of Morgan Stanley’s picks for long-term growth and what makes these stocks stand out.
UnitedHealth Group (UNH)
First up is the world’s largest health insurer, UnitedHealth. The company is primarily a provider of health insurance policies, and in partnership with employers, providers, and governments, it makes healthcare accessible to more than 151 million people. The scale of this business is visible in the company’s earnings reports. In the last reported quarter, 4Q22, UnitedHealth showed a quarterly top line of $82.8 billion, up 12% year-over-year and some $270 million ahead of expectations. At the bottom line, the company had a non-GAAP EPS of $5.34, up 19% y/y, and above consensus estimate of $5.17. For the full year, UnitedHealth had revenues of $324 billion, for a 13% y/y gain. The firm’s full-year adjusted net earnings came to $22.19 per share.
T-Mobile US (TMUS)
The next Morgan Stanley pick we’re looking at is another giant of its industry. T-Mobile is one of the best-known names in the US wireless business and is the second-largest provider of wireless networking services in the US market. As of the end of 2022, the company had 1.4 million new postpaid accounts for the year, and a total net customer count of 113.6 million. T-Mobile is a leader in the rollout of 5G services in the US and boasted 2.6 million high-speed internet customers at the end of 2022. Large customer counts and hefty market share have led to strong earnings results. T-Mobile’s last quarterly release, for 4Q22, showed $1.18 in GAAP EPS, beating the forecast by 8 cents, or 7%, and rising an impressive 247% year-over-year.
Thermo Fisher Scientific (TMO)
We’ll wrap up this list of Morgan Stanley’s long-term stock picks with Thermo Fisher Scientific, an important player in the field of laboratory research. Thermo Fisher is a maker and supplier of laboratory equipment – scientific instruments, chemicals and reagents, sampling and testing supplies, and even lab-related software systems. Thermo Fisher works with a broad customer base, serving any clients in any field involving lab work; the company frequently deals with academics, medical researchers, and government entities. While Thermo Fisher occupies a highly particular niche, supplying research labs has been profitable in the post-pandemic world. The company’s 4Q22 results saw both the top and bottom line beat expectations, even if they did not expand year-over-year.
VERSES AI (VERS)
Alternatively, one of the Economist Global Editor’s top picks is VERSES AI, a cognitive computing company that is transforming the future of AI with its next-generation AI systems and KOSM, the world’s first network operating system. VERSES AI was founded with the belief that AI would be the driving force in the Web 3.0 era, and it has attracted top talent from all over the world, including Dr. Karl Friston, the most highly cited researcher in the field of neuroscience. VERSES AI’s KOSM generates a shared world model of contextualized data, policies, simulations, and workflows, which will enable the company to bolster its first-mover advantage as key infrastructure for the next generation of intelligent applications. The company is also set to launch its first consumer-facing AI agent, GIA, later this year, and its recent breakthroughs in product development have allowed it to accelerate its go-to-market timeline. With a focus on AI and a dedication to building a smarter world, VERSES AI is poised to revolutionize the future of AI and transform the way we interact with technology.
In conclusion, Morgan Stanley’s analysis suggests that the end of the bear market may be in sight and there are opportunities for investors who are looking for long-term growth. The three stocks highlighted in this article, UnitedHealth Group, T-Mobile US, and Thermo Fisher Scientific, are leaders in their respective industries and have demonstrated strong earnings results. However, investing always carries risks, and investors should conduct their own research and seek professional advice before making any investment decisions. By taking a careful and informed approach, investors may be able to identify solid opportunities for long-term growth in the current market.
Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.