Episode summary
Morgan Stanley’s AI Winners List Is Full of Bank Stocks
Summary
The host argues that the AI trade is moving from infrastructure winners to operating businesses that can show measurable payback. He points to Morgan Stanley’s analysis of 18,000 corporate transcripts, which found that 44% of S&P 500 companies can report at least one quantifiable AI benefit, and that 26%, or 125 companies, are already seeing direct financial impacts such as lower costs and higher revenue. He says that is the key question investors should care about: whether AI is actually improving margins and returns on investment.
The list of AI adopters is heavily tilted toward financial firms, including Bank of America, JPMorgan Chase, American Express, Citigroup, Blackstone, Visa, State Street and Bank of New York Mellon. The host says that makes sense because Wall Street companies move quickly and can use AI in credit analysis, customer targeting, back-office processing and other high-volume workflows. He argues that the technology tends to spread first where the return on investment is easiest to prove.
He also highlights UnitedHealth Group as an example of a business where AI could help improve thin margins. Looking ahead, he says 2027 should be the year adopters matter more than enablers, with margin expansion across the S&P 500 supporting the stock market.
Key takeaways
- Morgan Stanley’s transcript study found 44% of S&P 500 companies can measure at least one AI benefit, according to the host.
- The host says 26% of the index, or 125 companies, are already seeing direct financial impacts from AI such as lower costs and higher revenue.
- Financial firms dominate Morgan Stanley’s winners list, led by Bank of America, JPMorgan Chase, American Express, Citigroup, Visa and Blackstone.
- The host argues AI should spread first to Wall Street because those firms can prove return on investment quickly through faster credit checks, targeting and back-office automation.
- The host says 2027 will be the year adopters matter more than enablers as AI begins lifting margins and earnings.
Notable quotes
“Morgan Stanley analysis of 18,000 corporate transcripts reveals 44% of the S&P 500 companies now are able to report at least one quantifiable benefit”
“26% of these companies 125 companies have seen direct financial impacts such as lower cost and higher revenue”
“When it comes to return on investment tools that can get you high returns on investment, it spreads to Wall Street first”
“AI is going to help speed all of those things up. Also, analyzing credit risk. AI can help really speed that up”
“I think 2027 is going to be the year of adopters margins increasing and that is a strong support for the stock market”
How the episode opens
Good morning. This is Dylan Joan with Behind the Markets. Happy Wednesday.
Today is Wednesday, November 11th. Last month, I wrote an article and did a video here in Dylan's diary talking about how the AI trade will shift in 2027 from enablers to adopters. And so far in the AI story, the enablers have made all the great returns.
And when you think about enablers, companies that have actually brought us the ability to use AI, you know, semiconductor stocks, right? Nvidia, Micron, Broadcom, AMD, you know, again, these are enablers. Power stocks, companies that basically made AI use possible.
OpenAI, Chad GBT, all of these companies that built the infrastructure of AI, they are the enablers. They're enabling companies to adopt and use them. So, we talked about here last month before the whole midterm drama came out.
The story is shifting. A lot of the money has been made with the enablers. We've seen them move great.
They've had great great time here. Now, it's the adopters, the companies that are actually taking these tools and putting them to work. Now, Morgan Stanley was out with a new research note this week supporting the video that we put up last week and supporting this argument.
And basically, a Morgan Stanley analysis of 18,000 corporate transcripts reveals 44% of the S&P 500 companies now are able to report at least one quantifiable benefit, one benefit they could actually measure due to AI. And you know they keep talking about productivity but what makes me happiest is they're seeing direct financial impacts. 26% of these companies 125 companies have seen direct financial impacts such as lower cost and higher revenue.
Again in business the only thing that matters a business's sole purpose for existing is to achieve a highest return on its investment.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- ai roi
- morgan stanley analyst list
- bank stocks
- sp 500 ai benefits
- ai adopters margins 2027
Companies and tickers mentioned
- MS
- NVDA
- MU
- AVGO
- AMD
- BAC
- UNH
- PG
- RXRX
- STT
- C
- JPM
- AXP
- V
- DVN
- RTX
- CVS
- LOW
- RF
- CFG
- CI
- FITB
- GE
- CMG
- BX
- Morgan Stanley
- Nvidia
- Micron
- Broadcom
- AMD
- Bank of America
- UnitedHealth Group
- Procter & Gamble
- Recursion Pharmaceuticals
- State Street
- Citigroup
- Grindr
- JPMorgan Chase
- American Express
- Visa
- Devon Energy
- RTX
- CVS
- Lowe's
- Regions Financial
- Citizens Financial
- Cigna Group
- Fifth Third Bancorp
- GE Aerospace
- Chipotle
- Bank of New York Mellon
- Blackstone
Watch the episode
Watch “Morgan Stanley’s AI Winners List Is Full of Bank Stocks” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
More from Behind The Markets Podcast
-
Nvidia CEO Out: 4 Reasons I’m Not Panicking About Nvidia -
Chip Stocks Sell-Off: Why the AI Build-Out Just Went From 3 to 5 Years -
Midterm Election Results: The Stock Market’s Winners and Losers -
Google Stock: Why AI Mode Earns Less Than Search -
Q3 GDP: Data Centers Up 127%, But 62% Say the Economy's Bad -
AI Debt Bubble? Wall Street Is Done Funding Bad AI Companies
Behind The Markets Podcast, this episode and its artwork belong to their owners. Octagon is not affiliated with the show; this page is an independent summary.
