Morgan Stanley’s latest list of favoured names for 2026 spans consumer finance, healthcare, mega-cap technology, cybersecurity and data storage, with the bank arguing that each offers a mix of earnings momentum and a near-term catalyst the market has yet to fully reward. The selections are Affirm, UnitedHealth Group, Meta Platforms, CrowdStrike and Seagate Technology, according to the note circulated by the bank and summarised by CoinCentral. Morgan Stanley’s case is that all five sit at the intersection of improving fundamentals and investor scepticism.

Affirm was singled out as the most mispriced of the group. Analyst James Faucette said the market’s anxiety over the company’s exposure to private credit was overstated, while the core buy-now, pay-later business still underpins the investment thesis. The bank sees a May 12 investor forum as a possible turning point, with scope for management to raise medium-term ambitions. Affirm is also due to report fiscal third-quarter results on May 7, giving investors an earlier read on the durability of demand.

UnitedHealth was added after a stronger-than-expected first quarter and an improved full-year outlook. The company reported adjusted earnings of $7.23 a share on revenue of $111.7bn, both ahead of forecasts, and lifted guidance to more than $18.25 a share for the year. Morgan Stanley said more favourable Medicare Advantage rates had helped sharpen the outlook, strengthening the case for the insurer even as the broader healthcare sector continues to navigate reimbursement and policy pressure.

Meta remains Morgan Stanley’s preferred large-cap technology name heading into earnings season. The bank believes artificial intelligence is improving the efficiency of advertising across its platforms and gives Meta a stronger earnings growth trajectory than rivals. That view comes ahead of the company’s April 29 results, after Meta said full-year 2025 revenue rose 22% and signalled that 2026 operating income should exceed 2025 levels despite heavy infrastructure spending.

CrowdStrike and Seagate round out the list with themes tied to enterprise security and AI infrastructure. Morgan Stanley upgraded CrowdStrike in March and named it its top software pick, pointing to the Falcon Flex platform, endpoint security strength and the company’s passage above $5bn in ending annual recurring revenue. The firm said CrowdStrike’s ARR grew 24%, while the group also delivered its first full year of positive GAAP net income and record free cash flow. Seagate was preferred over Western Digital on the grounds that margins could expand further and high-capacity drives are likely to benefit from AI-generated data and cloud storage demand. Its upcoming fiscal third-quarter results on April 28 are seen as the first major test of that thesis.

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Source: Noah Wire Services