| Snowflake Score | |
|---|---|
| Valuation | 1/6 |
| Future Growth | 2/6 |
| Past Performance | 3/6 |
| Financial Health | 4/6 |
| Dividends | 0/6 |
MCO Overview
Moody's Corporation operates as an integrated risk assessment firm worldwide.
Moody's Competitors
Price History & Performance
| Historical stock prices | |
|---|---|
| Current Share Price | US$390.34 |
| 52 Week High | US$253.17 |
| 52 Week Low | US$395.19 |
| Beta | 1.16 |
| 1 Month Change | 3.74% |
| 3 Month Change | 3.11% |
| 1 Year Change | 46.64% |
| 3 Year Change | 176.56% |
| 5 Year Change | 294.12% |
| Change since IPO | 2,358.84% |
Recent News & Updates
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.
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
| MCO | US Capital Markets | US Market | |
|---|---|---|---|
| 7D | 3.0% | 3.1% | 0.9% |
| 1Y | 46.6% | 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
| MCO volatility | |
|---|---|
| MCO Beta | 1.16 |
| Industry Beta | 1.19 |
| Market Beta | 1 |
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
| Founded | Employees | CEO | Website |
|---|---|---|---|
| 1900 | 11,542 | Rob Fauber | https://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
| MCO fundamental statistics | |
|---|---|
| Market Cap | US$72.67b |
| Earnings (TTM) | US$2.09b |
| Revenue (TTM) | US$5.80b |
34.7x
P/E Ratio12.5x
P/S RatioIs MCO overvalued?
See Fair Value and valuation analysisEarnings & Revenue
| MCO income statement (TTM) | |
|---|---|
| Revenue | US$5.80b |
| Cost of Revenue | US$1.53b |
| Gross Profit | US$4.27b |
| Expenses | US$2.17b |
| Earnings | US$2.09b |
Last Reported Earnings
Jun 30, 2021
Next Earnings Date
Oct 28, 2021
| Earnings per share (EPS) | 11.25 |
| Gross Margin | 73.60% |
| Net Profit Margin | 36.11% |
| Debt/Equity Ratio | 267.2% |
How did MCO perform over the long term?
See historical performance and comparisonDividends
0.6%
Current Dividend Yield21%
Payout RatioValuation
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
| Data | Last Updated (UTC time) |
|---|---|
| Company Analysis | 2021/10/26 22:34 |
| End of Day Share Price | 2021/10/26 00:00 |
| Earnings | 2021/06/30 |
| Annual Earnings | 2020/12/31 |
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.