Morgan Stanley

The filings show rising earnings alongside a balance sheet that expanded quickly, and the cash-flow line is the item a careful reader should weigh most. The Beneish M-Score is -2.375, below -1.78, so its label is not in the elevated manipulation-risk zone. That is a screening result, not proof that the reported figures are accurate; it means the model did not flag the figures for a closer read. The Piotroski F-Score is 3 of 6 computable signals, meaning three of the six checks that could be computed point in the favorable direction, so it is a middling reading. The operating cash flow to net income ratio of -1.06 is a direct calculation from the 2025 figures: positive reported net income came with negative operating cash flow. Broker-dealers can show large swings in operating cash flow because of trading and securities financing balances, and the 10-Q reflects that pattern, with securities sold under agreements to repurchase rising from $78.54 billion at year-end 2025 to $119.83 billion at March 31, 2026. The Altman Z-Score and Fog Index are not on file in this data, so no value is given for either. The MD&A excerpt cites legal, regulatory and compliance risk and says climate risk is not expected to have a significant effect on consolidated results in the near term. Readers may want to look at the 2025 Form 10-K sections the filing cross-references, since the excerpt does not reproduce them. The data set lists 2025 revenue growth as 0.0%, but its annual revenue series ends in 2014, so that figure cannot be checked against the provided annual data.

Catalyst.According to the Q1 2026 10-Q, net revenues were $20.58 billion for the quarter ended March 31, 2026, up from $17.74 billion a year earlier, and net income applicable to Morgan Stanley rose to $5.57 billion from $4.32 billion. Investment banking revenue was $2.29 billion versus $1.71 billion, trading revenue was $6.73 billion versus $5.11 billion, and asset management revenue was $6.73 billion versus $5.96 billion. Net interest rose to $2.70 billion from $2.35 billion. Full-year 2025 net income was $16.86 billion, up from $13.39 billion in 2024.

Hidden risk.The most material tension is cash flow. Operating cash flow was negative $17.89 billion in 2025 even though net income was $16.86 billion, a ratio of -1.06. In the first quarter of 2026, operating cash flow was negative $7.10 billion, compared with negative $23.98 billion a year earlier. The balance sheet also grew quickly: total assets reached $1,581.42 billion at March 31, 2026, up from $1,420.27 billion at December 31, 2025, with trading assets at $526.21 billion and borrowings at $371.57 billion. The MD&A excerpt also describes legal, regulatory and AML, terrorist financing and anti-corruption exposure, which a casual reader may skim past.