Morgan Stanley: 30 stocks to hold for the long term

The Morgan Stanley research department has released a report outlining the 30 best US stocks to be holding over the next 3 years. The MS analysts say that “the main criterion is sustainability — of competitive advantage, business model, pricing power, cost efficiency, and growth.” “We selected the companies that scored best on these criteria, paying special attention to [return on net operating assets], management’s attitude toward capital structure, and clarity and consistency of share-holder remuneration (dividends / buybacks).” The note added: “We are taking a long-term view. We have tried to identify the best franchises, not the most undervalued stocks. There was no prerequisite in our analysis that they be rated ‘overweight,’ nor specific assumptions about where we are in the economic cycle or any other valuation considerations. Our driving principle was to create a list of companies whose business models and market positions would be increasingly differentiated by 2016.”


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