Morgan Stanley 's shift toward wealth management could make it a winner among major banks for investors, according to Citi. Analyst Keith Horowitz upgraded Morgan Stanley to buy from neutral, saying in a note to clients Friday that the bank's focus on wealthier clients make it stand out to its peers. "If there is one large cap bank that can move into a growth premium, we believe it is MS given the mousetrap they have built to capture wealth assets is very sound strategically and with their track record…we believe there is a strong likelihood they will execute on this opportunity," Horowitz wrote. Interest rates are generally expected to rise over the next year, and that could be a larger benefit to Morgan Stanley than many expected, according to Citi. "While MS is not the most asset sensitive, they might get a bigger bang for the buck as the benefit flows into their highest multiple business and will raise it to 50% of revenue mix in 2023 vs 40% today while improving the pretax margin," the note said. Morgan Stanley has outperformed financials and bank stocks broadly this year, rising 44% year to date and was up 0.6% in premarket trading Friday. Citi hiked its price target on the stock to $115 per share from $105. The new target is 16% above where the stock closed on Thursday. -CNBC's Michael Bloom contributed to this report.
The headquarters of Morgan Stanley in New York.
Shannon Stapleton | Reuters
Morgan Stanley's shift toward wealth management could make it a winner among major banks for investors, according to Citi.