Morgan Stanley Identifies Five Stocks with Strong Rally Potential
Investment firm Morgan Stanley has highlighted five stocks it believes have significant upside potential and are poised for growth in June 2025. These stocks include Nvidia, Nubank, Sallie Mae, Seagate, and Coupang. Each company exhibits strong catalysts, robust fundamentals, and favorable market positioning that underpin Morgan Stanley's bullish outlook.
Seagate: A Rising Star in Data Storage
Seagate Technology emerges as a compelling investment opportunity amid an inflection point in computing that is driving exponential growth in data storage demand. Morgan Stanley analyst Erik Woodring emphasizes Seagate’s leadership in technology, premium profit margins, strong free cash flow generation, and high capital returns as key drivers of potential earnings per share (EPS) upside and multiple re-rating.
- Seagate is currently valued at approximately 7.5 times peak EPS, signaling undervaluation.
- The stock has gained 36% year-to-date.
- It remains an attractive pick within the data center sector.
Coupang: Dominating South Korean E-Commerce
Coupang continues to expand its market share in the competitive South Korean e-commerce landscape, maintaining growth momentum despite increased competition. Analyst Seyon Park notes the company’s strong operational execution and resilience, supported by favorable currency trends, including insulation from tariff risks and benefits from a weaker US dollar.
- Price target recently raised from $27 to $32 per share.
- Shares have increased approximately 27% this year.
- Valuations remain attractive relative to peers.
Nubank: Accelerating Profitability in Latin America
Nubank is recognized for its rapid revenue scaling and differentiated consumer banking model, especially within Brazil’s financial ecosystem. The bank leads in primary account relationships, salary deposits, and dominates consumer intent across credit products.
- Currently up nearly 16% year-to-date.
- Demonstrates superior cross-selling capabilities compared to incumbents and peers.
- Positively positioned for continued growth and profitability expansion.
Nvidia: Solid Semiconductor Growth Outlook
Nvidia has overcome previous concerns surrounding market digestion and China-related headwinds. Its semiconductor business shows acceleration with durable growth drivers, reaffirming Morgan Stanley’s overweight and top pick status in the sector.
- Strong business fundamentals are paving the way for improvement.
- Durable inference trajectory supports sustained growth.
Sallie Mae: Strategic Expansion and Asset-Light Growth
Sallie Mae remains a top pick as it explores alternatives to whole loan sales, including joint ventures that could enhance multiple expansion through more consistent cash flows. Clarity on government policy is expected to enable the company to better project volume growth for the second half of 2026 and beyond.
- Focus on strategic initiatives to drive asset-light growth.
- Potential to improve financial metrics as policies become clearer.
Conclusion
Morgan Stanley’s current top stock selections reflect a balanced portfolio across technology, financial services, and e-commerce sectors, each supported by unique growth drivers and solid fundamentals. Investors seeking growth opportunities may consider these companies for their exposure to rising data demands, expanding digital economies, and strategic innovation.
