Markets & Finance

Prudential Upgrades Some Brokerage Stocks


Prudential upgrades brokerage companies Merrill Lynch (MER), Morgan Stanley (MWD), and Goldman Sachs (GS) to buy from hold.

Analyst David Trone says the September 11 tragedy and ensuing geopolitical actions created a great deal of uncertainty; we now know more about the impact on the global economy as it could have been worse. He notes that business and consumer confidence is improving as the U.S. military/political progress has been good, and no obvious terrorist attacks have occurred since the anthrax scare.

He says his concerns about the cost side is starting to be addressed; contraction of pretax margins has halted in the fourth quarter by more aggressive than expected cost cutting. He thinks the fourth quarter represents an inflection point for revenue.


Later, Baby
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