MORGAN STANLEY: These 16 stocks could get cut in half — or worse

• Morgan Stanley expects the US stock market to consolidate the secular bull run next year.
• But its analysts say 16 companies are "facing challenges that are independent of cyclical trends" and could lose more than half their value in the next 12 to 18 months.
• The firm has an "underweight" rating for all of the mentioned stocks and says their risks are larger than their rewards.

Morgan Stanley has released the stocks its analysts think could lose more than half their value within the next 12 to 18 months.

These companies are "facing challenges that are independent of cyclical trends," the bank's analysts said.

They expect the US stock market to consolidate the secular bull run next year and for US economic growth to slow down, followed by a reacceleration in 2020. While the macro outlook seems favorable, analysts identified some companies with secular challenges including market-share loss, rising competition, deteriorating end markets, and cost pressures.

To compile the list, Morgan Stanley's equity-research team started with the stocks its analysts rated as underweight. The bank then focused on stocks with an "unfavorable risk-reward skew," looking for stocks where the cons outweighed the pros.

Here are the 16 stocks Morgan Stanley says stand to lose the most from secular pressures in the next 12 to 18 months:

16. Macy's

Ticker: M

Sector: Retail

Year-to-date performance: +30%

Source: Morgan Stanley

15. Patterson Companies

Ticker: PDCO

Sector: Healthcare

Year-to-date performance: -33%

Source: Morgan Stanley

14. United Natural Foods

Ticker: UNFI

Sector: Retail

Year-to-date performance: -57%

Source: Morgan Stanley