Moody's (MCO) Valuation Check After 5% Monthly Gain and Ongoing Share Price Momentum

Moody's (MCO) has been quietly grinding higher, up about 5% over the past month and 8% over the past year as investors lean into its steady revenue and earnings momentum.

See our latest analysis for Moody's.

With the share price now around $497.69, Moody's recent 30 day share price return in the mid single digits and a solid multi year total shareholder return suggest momentum is still building as investors reward its consistent growth profile.

If Moody's steady climb has you thinking about what else could compound over time, this is a good moment to explore fast growing stocks with high insider ownership.

Yet with shares hovering just below analyst targets and trading at a premium to traditional value metrics, the key question now is whether Moody's remains mispriced to the upside or if the market is already discounting years of growth ahead.

Most Popular Narrative Narrative: 8.8% Undervalued

Compared with Moody's last close at $497.69, the most popular narrative implies a higher fair value, framing the stock as modestly mispriced in investors' favor.

The analysts have a consensus price target of $543.4 for Moody's based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $595.0, and the most bearish reporting a price target of just $475.0.

Read the complete narrative.

Curious how steady mid single digit growth assumptions, fatter margins, and a lofty future earnings multiple can still support upside from here? The full narrative explains the exact profit runway and valuation math that underpin this seemingly rich, yet still optimistic, fair value.

Result: Fair Value of $545.50 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, surging regulatory scrutiny on private credit and intensifying AI driven competition could compress margins and challenge the optimistic growth assumptions embedded in this valuation.

Find out about the key risks to this Moody's narrative.

Another Angle on Valuation

On earnings based multiples, the picture flips. Moody's trades on a P E ratio of 39.6 times, well above the US Capital Markets average of 25.3 times, its peer average of 31.1 times, and the fair ratio of 17.7 times, raising the risk that even small disappointments could hit the share price hard. Is the market overpaying for quality and growth here, or are analysts still too cautious?

See what the numbers say about this price — find out in our valuation breakdown.

Build Your Own Moody's Narrative

If you are skeptical of this view or simply prefer hands on research, you can build a personalized thesis in just a few minutes: Do it your way.

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.

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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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