Did Strong Q2 Results and Updated Buybacks Just Shift Moody's (MCO) Investment Narrative?

• Moody's Corporation recently reported higher second quarter and first half 2025 results, with sales reaching US$1.90 billion and net income at US$578 million for the quarter, while also affirming a US$0.94 quarterly dividend, updating its share buyback program, and announcing recent board changes.
• These announcements highlight Moody's ongoing commitment to boosting shareholder returns through consistent capital management and improved operational performance.
• We will explore how Moody's solid quarterly earnings growth and continued share repurchases influence its current investment narrative and outlook.

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Moody's Investment Narrative Recap

Owning Moody's stock is about believing in the durability of its data-driven risk assessment business, especially as global credit markets evolve. The latest earnings results, combined with ongoing dividends and share buybacks, indicate steady operational execution; however, these updates do not materially shift the most significant catalyst, private credit market expansion, or the elevated risk from regulatory scrutiny targeting this area.

The company's announcement of a US$0.94 quarterly dividend stands out this quarter, reinforcing Moody's track record of prioritizing consistent capital returns even as it grows private credit and analytics offerings. This stable payout policy can help cushion near-term volatility around changes in the sector, supporting investor confidence in Moody's cash flow strength.

But while growth opportunities remain robust, investors should also be aware that rising regulatory and political scrutiny of the private credit market...

Read the full narrative on Moody's (it's free!)

Moody's narrative projects $8.7 billion revenue and $2.9 billion earnings by 2028. This requires 6.6% yearly revenue growth and a $0.8 billion earnings increase from $2.1 billion today.

Uncover how Moody's forecasts yield a $518.08 fair value, in line with its current price.

Exploring Other Perspectives

Simply Wall St Community users offered 12 fair value estimates for Moody’s, ranging from US$251.06 to US$518.08 per share. Their valuations reflect competing views on regulatory risks in private credit and how these could affect future margins and growth, so consider multiple perspectives before making any investment decisions.

Explore 12 other fair value estimates on Moody's - why the stock might be worth as much as $518.08!

Build Your Own Moody's Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Moody's research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.
• Our free Moody's research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Moody's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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