Assessing MSCI Share Value After a 5.8% Drop and Recent Market Optimism

• Wondering if now is the right time to buy MSCI stock? Let’s review where the value truly lies and what you should know before making your next move.
• MSCI has recently seen its share price dip about 5.8% over the past year. It has gained 0.6% in the past week and 2.9% over the last month, reflecting some short-term optimism.
• Market watchers have pointed to shifts in global index demand and ongoing FinTech innovations as likely contributors to recent price swings. Broader volatility in financial services and changes in investor sentiment toward data-driven businesses have put MSCI in the spotlight.
• According to our valuation checks, MSCI is undervalued in 0 out of 6 possible ways, giving it a valuation score of 0. We will break down the numbers, look at classic and alternative valuation methods, and provide another perspective for assessing MSCI’s worth by the end of this article.

MSCI scores just 0/6 on our valuation checks. See what other red flags we found in the full valuation breakdown.

Approach 1: MSCI Discounted Cash Flow (DCF) Analysis

The Discounted Cash Flow (DCF) model estimates a company's value by projecting its future cash flows and discounting them back to today’s dollars. For MSCI, this involves forecasting the firm’s ability to generate cash well into the future and then calculating what those future dollars are worth right now.

Currently, MSCI’s trailing twelve-month Free Cash Flow is $1.4 Billion. Analysts estimate this figure will continue to rise, with projections reaching $2.1 Billion by the end of 2029. While direct analyst estimates only extend five years ahead, further growth has been extrapolated to span a full decade and provide a longer-term perspective.

Based on these cash flow forecasts, the DCF model arrives at an intrinsic value of $527.80 per share. However, with MSCI's recent share price, this model indicates the stock is about 6.6% above its fair value and may be slightly overvalued in today’s market.

Result: ABOUT RIGHT

MSCI is fairly valued according to our Discounted Cash Flow (DCF), but this can change at a moment's notice. Track the value in your watchlist or portfolio and be alerted on when to act.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for MSCI.

Approach 2: MSCI Price vs Earnings

For established, profitable companies like MSCI, the Price-to-Earnings (PE) ratio is a widely used valuation metric. It provides a quick way to gauge how much investors are willing to pay for each dollar of the company’s earnings, serving as a useful indicator of market sentiment and expectations.

Growth prospects and perceived risks play a big role in what counts as a “normal” or “fair” PE ratio. Companies expected to grow faster or those perceived as safer by investors tend to attract higher PE ratios, while lower growth or higher risk drags multiples down.

Currently, MSCI trades at a PE ratio of 34.6x. This is above both the industry average PE of 23.5x and its peer average of 33.6x. This suggests that investors are willing to pay a premium for MSCI relative to its sector and direct competitors.

Simply Wall St’s proprietary Fair Ratio for MSCI is 16.6x. This Fair Ratio offers a more accurate benchmark by accounting for growth, risk, profit margins, industry characteristics, and the company’s market capitalization. These are factors that generic industry or peer averages can miss. By focusing on what truly matters to MSCI’s potential and its risks, the Fair Ratio provides a sharper lens for judging share price value.

Comparing MSCI’s actual PE (34.6x) to its Fair Ratio (16.6x), the stock is trading well above what we’d expect based on its fundamentals and outlook. This suggests MSCI could be overvalued at its current price.

Result: OVERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover 1442 companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your MSCI Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let’s introduce you to Narratives. A Narrative is simply your story about a company: how you believe its business can evolve, what sort of financial growth seems realistic, and what all of that means for its fair value. Instead of just relying on broad averages or static ratios, Narratives link a company’s long-term story to a financial forecast, turning your perspective into meaningful numbers and an estimated fair price.

On Simply Wall St’s Community page, millions of investors are already using Narratives as an easy, dynamic tool to compare their view with others. Narratives make decision-making more powerful by letting you quickly see how your fair value stacks up against the live market price. This can help you spot opportunities or risks faster. These forecasts update automatically when new information, like earnings results or industry news, comes in, which means your story stays relevant as the facts change.

For example, when it comes to MSCI, some investors see recurring revenue and global ETF growth driving a fair value up to $700 per share. Others add caution for fee compression and competition, assigning a value closer to $520. Narratives let you capture and compare these views, making your investment decision process smarter and more personalized.

Do you think there's more to the story for MSCI? Head over to our Community to see what others are saying!

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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