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MCO

Moody'sNYSE:MCO Stock Report

Market Cap

US$72.7b

7D

3.0%

1Y

46.6%

Updated

26 Oct, 2021

Data

Company Financials +
MCO fundamental analysis
Snowflake Score
Valuation1/6
Future Growth2/6
Past Performance3/6
Financial Health4/6
Dividends0/6

MCO Overview

Moody's Corporation operates as an integrated risk assessment firm worldwide.

Moody's Competitors

S&P Global

NYSE:SPGI

US$111.9b

CME Group

NasdaqGS:CME

US$78.7b

Intercontinental Exchange

NYSE:ICE

US$75.3b

MSCI

NYSE:MSCI

US$53.0b

Price History & Performance

Summary of all time highs, changes and price drops for Moody's
Historical stock prices
Current Share PriceUS$390.34
52 Week HighUS$253.17
52 Week LowUS$395.19
Beta1.16
1 Month Change3.74%
3 Month Change3.11%
1 Year Change46.64%
3 Year Change176.56%
5 Year Change294.12%
Change since IPO2,358.84%

Recent News & Updates

Aug 31

What To Make Of Moody's Valuation

Moody's has evolved into a company that offers more than just ratings. The company is in a great spot to deliver continuous free cash flow growth in the future used to acquire new growth and to boost shareholder distributions. Unfortunately, the valuation has become very lofty, which is a reason for me to stay away as it could hurt the stock price performance over the next 1-2 years.

Aug 07
Should You Be Adding Moody's (NYSE:MCO) To Your Watchlist Today?

Should You Be Adding Moody's (NYSE:MCO) To Your Watchlist Today?

It's only natural that many investors, especially those who are new to the game, prefer to buy shares in 'sexy' stocks...

Shareholder Returns

MCOUS Capital MarketsUS Market
7D3.0%3.1%0.9%
1Y46.6%71.9%33.4%

Return vs Industry: MCO underperformed the US Capital Markets industry which returned 68.2% over the past year.

Return vs Market: MCO exceeded the US Market which returned 33.4% over the past year.

Price Volatility

Is MCO's price volatile compared to industry and market?
MCO volatility
MCO Beta1.16
Industry Beta1.19
Market Beta1

Stable Share Price: MCO is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 2% a week.

Volatility Over Time: MCO's weekly volatility (2%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
190011,542Rob Fauberhttps://www.moodys.com

Moody's Corporation operates as an integrated risk assessment firm worldwide. It operates in two segments, Moody’s Investors Service and Moody’s Analytics. The Moody’s Investors Service segment publishes credit ratings and provides assessment services on various debt obligations, programs and facilities, and entities that issue such obligations, such as various corporate, financial institution, and governmental obligations; and structured finance securities.

Moody's Fundamentals Summary

How do Moody's's earnings and revenue compare to its market cap?
MCO fundamental statistics
Market CapUS$72.67b
Earnings (TTM)US$2.09b
Revenue (TTM)US$5.80b

34.7x

P/E Ratio

12.5x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
MCO income statement (TTM)
RevenueUS$5.80b
Cost of RevenueUS$1.53b
Gross ProfitUS$4.27b
ExpensesUS$2.17b
EarningsUS$2.09b

Last Reported Earnings

Jun 30, 2021

Next Earnings Date

Oct 28, 2021

Earnings per share (EPS)11.25
Gross Margin73.60%
Net Profit Margin36.11%
Debt/Equity Ratio267.2%

How did MCO perform over the long term?

See historical performance and comparison

Dividends

0.6%

Current Dividend Yield

21%

Payout Ratio

Valuation

Is Moody's undervalued compared to its fair value and its price relative to the market?

34.71x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: MCO ($390.34) is trading above our estimate of fair value ($373.36)

Significantly Below Fair Value: MCO is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: MCO is poor value based on its PE Ratio (34.7x) compared to the US Capital Markets industry average (16.7x).

PE vs Market: MCO is poor value based on its PE Ratio (34.7x) compared to the US market (18.3x).


Price to Earnings Growth Ratio

PEG Ratio: MCO is poor value based on its PEG Ratio (5.7x)


Price to Book Ratio

PB vs Industry: MCO is good value based on its PB Ratio (33.2x) compared to the US Capital Markets industry average (61.4x).


Future Growth

How is Moody's forecast to perform in the next 1 to 3 years based on estimates from 15 analysts?

6.1%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: MCO's forecast earnings growth (6.1% per year) is above the savings rate (2%).

Earnings vs Market: MCO's earnings (6.1% per year) are forecast to grow slower than the US market (14.7% per year).

High Growth Earnings: MCO's earnings are forecast to grow, but not significantly.

Revenue vs Market: MCO's revenue (6.3% per year) is forecast to grow slower than the US market (9.9% per year).

High Growth Revenue: MCO's revenue (6.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: MCO's Return on Equity is forecast to be very high in 3 years time (77.2%).


Past Performance

How has Moody's performed over the past 5 years?

25.6%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: MCO has high quality earnings.

Growing Profit Margin: MCO's current net profit margins (36.1%) are higher than last year (33.4%).


Past Earnings Growth Analysis

Earnings Trend: MCO's earnings have grown significantly by 25.6% per year over the past 5 years.

Accelerating Growth: MCO's earnings growth over the past year (20.6%) is below its 5-year average (25.6% per year).

Earnings vs Industry: MCO earnings growth over the past year (20.6%) underperformed the Capital Markets industry 77.6%.


Return on Equity

High ROE: Whilst MCO's Return on Equity (87.98%) is outstanding, this metric is skewed due to their high level of debt.


Financial Health

How is Moody's's financial position?


Financial Position Analysis

Short Term Liabilities: MCO's short term assets ($4.7B) exceed its short term liabilities ($2.1B).

Long Term Liabilities: MCO's short term assets ($4.7B) do not cover its long term liabilities ($8.1B).


Debt to Equity History and Analysis

Debt Level: MCO's debt to equity ratio (267.2%) is considered high.

Reducing Debt: MCO had negative shareholder equity 5 years ago, but is now positive and has therefore improved.

Debt Coverage: MCO's debt is well covered by operating cash flow (38.3%).

Interest Coverage: MCO's interest payments on its debt are well covered by EBIT (25.7x coverage).


Balance Sheet


Dividend

What is Moody's current dividend yield, its reliability and sustainability?

0.63%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: MCO's dividend (0.64%) isn’t notable compared to the bottom 25% of dividend payers in the US market (1.27%).

High Dividend: MCO's dividend (0.64%) is low compared to the top 25% of dividend payers in the US market (3.48%).


Stability and Growth of Payments

Stable Dividend: MCO is not paying a notable dividend for the US market, therefore no need to check if payments are stable.

Growing Dividend: MCO is not paying a notable dividend for the US market, therefore no need to check if payments are increasing.


Current Payout to Shareholders

Dividend Coverage: MCO is not paying a notable dividend for the US market.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of MCO's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.0yrs

Average management tenure


CEO

Rob Fauber (51 yo)

0.75

Tenure

US$5,794,932

Compensation

Mr. Robert Scott Fauber, also known as Rob, has been President and Chief Executive Officer at Moody’s Corporation since January 1, 2021. He serves as Director of Moody's Corporation since October 22, 2020...


CEO Compensation Analysis

Compensation vs Market: Rob's total compensation ($USD5.79M) is below average for companies of similar size in the US market ($USD11.15M).

Compensation vs Earnings: Rob's compensation has been consistent with company performance over the past year.


Leadership Team

Experienced Management: MCO's management team is considered experienced (3 years average tenure).


Board Members

Experienced Board: MCO's board of directors are not considered experienced ( 2.6 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: MCO insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Moody's Corporation's employee growth, exchange listings and data sources


Key Information

  • Name: Moody's Corporation
  • Ticker: MCO
  • Exchange: NYSE
  • Founded: 1900
  • Industry: Financial Exchanges and Data
  • Sector: Diversified Financials
  • Market Cap: US$72.673b
  • Shares outstanding: 186.18m
  • Website: https://www.moodys.com

Number of Employees


Location

  • Moody's Corporation
  • 7 World Trade Center
  • 250 Greenwich Street
  • New York
  • New York
  • 10007
  • United States

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/10/26 22:34
End of Day Share Price2021/10/26 00:00
Earnings2021/06/30
Annual Earnings2020/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.