Morgan Stanley’s Top Stock Picks for September
As markets head into September, Morgan Stanley analysts are flagging several overweight-rated names they believe still have significant upside. The list includes Chewy, Nu Holdings, Cummins, Perimeter Solutions, and Cadence Design Systems.
Perimeter Solutions (PRM)
The maker of firefighting foam has become a fresh top pick at Morgan Stanley. Analyst Daniel Kutz argues that Perimeter’s earnings power is insulated from macroeconomic volatility, thanks to unique business drivers.
“PRM’s unique portfolio is levered to drivers largely uncorrelated with macroeconomic trends, insulating its earnings power from tariff/trade uncertainty and recession risks,” Kutz wrote.
He also pointed to near-term catalysts such as potential M&A activity and heightened wildfire activity. Kutz lifted his price target to $25 from $17, citing the stock’s “compelling” valuation. PRM shares are up 75% year-to-date.
Chewy (CHWY)
Morgan Stanley remains bullish on the online pet retailer ahead of its September 10 earnings report. Analyst Nathan Feather highlighted improving pet industry trends, alternative data pointing to growth, and cost-side upside.
“We see a strong 2Q earnings set-up and are tactically positive given improving pet macro trends, strong alternative data and underestimated upside on expenses,” Feather said.
He reaffirmed Chewy as a Top Pick, noting market share gains, margin improvement, and growth opportunities in veterinary clinics. Shares are already up 23% in 2025.
Nu Holdings (NU)
The Brazilian digital bank continues to impress, according to analyst Jorge Kuri. Following a strong August quarter, Kuri said Nubank’s fundamentals and technology give it room to grow.
“Nubank delivered a strong quarter, outperforming consensus — especially on credit growth, which we see as the main driver of future earnings upgrades,” he wrote.
Morgan Stanley’s bottom-up model suggests Nubank could reach a $100 billion valuation by 2026, up from roughly $62 billion today. Shares are up 42% this year.
Cummins (CMI)
Despite concerns about a downturn in the trucking industry, Morgan Stanley believes Cummins’ operational discipline and strategic investments should help it outperform.
“With the market pricing in a demand downturn in HD/MD trucks in 2H25 as severe as the 2008 Global Financial Crisis, the mixture of operational self-help and investments in Power Systems bolsters our conviction,” analysts wrote.
Cadence Design Systems (CDNS)
Finally, Morgan Stanley highlighted Cadence as a structural growth story within chip design and electronic automation.
“The company has a solid base in systems analysis and simulation work, deep customer relationships, a leading position in analog and mixed-signal design, a strong balance sheet, and should enjoy strong structural growth with its new AI-driven EDA tools,” analysts noted.
Bottom Line
Morgan Stanley’s September list leans into names with defensive qualities (PRM), secular growth stories (NU, CDNS), cyclical resilience (CMI), and tactical near-term catalysts (CHWY). For investors seeking a mix of stability and upside, these five stocks are positioned as the bank’s highest-conviction calls.
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