Why Shares of Morgan Stanley Are Rising Today

Shares of Morgan Stanley (NYSE: MS) traded nearly 5% higher when the market opened today after the bank announced yesterday that it plans to increase its quarterly dividend and also authorized a new share repurchase program. As of 11:18 a.m. ET today, shares had fallen back and only traded more than 2% higher.

Morgan Stanley said it plans to increase its quarterly dividend to nearly $0.78 per share in the third quarter from the current quarterly dividend of $0.70 per share, representing a nearly 11% increase. With the increase, it would have an annual dividend yield of roughly 3.9% with shares currently trading around $80, which is very strong.

The bank also said that its board of directors has authorized a new multiyear share repurchase program of as much as $20 billion. The plan will begin in the third quarter and does not currently have an expiration date. With its market cap of nearly $140 billion, buying back the full $20 billion would represent more than 14% of the bank's total market capitalization.

Source Fool.com