Financial Analysis: FXCM (OTCMKTS:GLBR) & Morgan Stanley (NYSE:MS)

Morgan Stanley (NYSE:MS) and FXCM (OTCMKTS:GLBR) are both finance companies, but which is the better business? We will compare the two companies based on the strength of their valuation, earnings, institutional ownership, profitability, dividends, risk and analyst recommendations.

Volatility & Risk

Morgan Stanley has a beta of 1.2, meaning that its stock price is 20% more volatile than the S&P 500. Comparatively, FXCM has a beta of -2.38, meaning that its stock price is 338% less volatile than the S&P 500.

Analyst Ratings

This is a summary of recent ratings and recommmendations for Morgan Stanley and FXCM, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Morgan Stanley	0	8	8	3	2.74
FXCM	0	0	0	0	0.00

Morgan Stanley presently has a consensus price target of $181.85, indicating a potential downside of 4.97%. Given FXCM’s higher probable upside, analysts clearly believe FXCM is more favorable than Morgan Stanley.

Institutional and Insider Ownership

84.2% of Morgan Stanley shares are held by institutional investors. 0.2% of Morgan Stanley shares are held by insiders. Comparatively, 9.0% of FXCM shares are held by insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Profitability

This table compares Morgan Stanley and FXCM’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Morgan Stanley	13.85%	16.40%	1.24%
FXCM	N/A	N/A	N/A

Valuation and Earnings

This table compares Morgan Stanley and FXCM”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Morgan Stanley	$64.25 billion	4.73	$13.39 billion	$9.75	19.63
FXCM	N/A	N/A	N/A	N/A	N/A

Morgan Stanley has higher revenue and earnings than FXCM.

Summary

Morgan Stanley beats FXCM on 9 of the 11 factors compared between the two stocks.

About Morgan Stanley

Morgan Stanley, a financial holding company, provides various financial products and services to corporations, governments, financial institutions, and individuals in the Americas, Europe, the Middle East, Africa, and Asia. It operates through Institutional Securities, Wealth Management, and Investment Management segments. The Institutional Securities segment offers capital raising and financial advisory services, including services related to the underwriting of debt, equity, and other securities, as well as advice on mergers and acquisitions, restructurings, real estate, and project finance. This segment also provides equity and fixed income products comprising sales, financing, prime brokerage, and market-making services; foreign exchange and commodities; corporate and commercial real estate loans, commercial mortgage and secured lending facilities, and financing for sales and trading customers, and asset-backed and mortgage lending; and wealth management services, investment, and research services. The Wealth Management segment offers financial advisor-led brokerage, custody, administrative, and investment advisory services; self-directed brokerage services; financial and wealth planning services; workplace services, including stock plan administration; annuity and insurance products; securities-based lending, residential real estate loans, and other lending products; banking; and retirement plan services to individual investors and small to medium-sized businesses and institutions. The Investment Management segment provides equity, fixed income, alternatives and solutions, and liquidity and overlay services to benefit/defined contribution plans, foundations, endowments, government entities, sovereign wealth funds, insurance companies, third-party fund sponsors, corporations, and individuals through institutional and intermediary channels. The company was founded in 1924 and is headquartered in New York, New York.

About FXCM

Global Brokerage, Inc., through its subsidiaries, provides online foreign exchange (FX) trading, contracts for difference trading, spread betting, and related services to retail and institutional customers worldwide. Its proprietary trading platform presents its FX customers with the price quotations on various currency pairs from a range of global banks, financial institutions, and market makers. The company also acts as a credit intermediary and simultaneously entering into trades with the customer and the FX market maker. It offers its customers access to over-the-counter FX markets. The company was formerly known as FXCM Inc. and changed its name to Global Brokerage, Inc. in February 2017. Global Brokerage, Inc. was incorporated in 2010 and is based in New York, New York. On March 23, 2023, an involuntary petition for liquidation under Chapter 7 was filed against Global Brokerage, Inc. in the U.S. Bankruptcy Court for the Southern District of New York. On May 19, 2023, the involuntary petition was approved by the Court.