Moody`s Corp
Exchange: NYSESector: Financial ServicesIndustry: Financial Data & Stock Exchanges
Moody's is an essential component of the global capital markets, providing credit ratings, research, tools and analysis that contribute to transparent and integrated financial markets. Moody’s Corporation is the parent company of Moody's Investors Service, which provides credit ratings and research covering debt instruments and securities, and Moody's Analytics, which offers leading-edge software, advisory services and research for credit and economic analysis and financial risk management. The corporation, which reported revenue of $4.4 billion in 2018, employs approximately 13,200 people worldwide and maintains a presence in 44 countries.
Did you know?
Free cash flow has been growing at 8.2% annually.
Current Price
$466.72
+1.55%GoodMoat Value
$324.33
30.5% overvaluedProfile
Valuation (TTM)
Market Cap$83.26B
P/E33.86
EV$83.59B
P/B20.54
Shares Out178.40M
P/Sales10.79
Revenue$7.72B
EV/EBITDA23.08
Moody`s Corp (MCO) Stock Analysis
GoodMoat Analysis
Moody's Corp is a high-quality financial data and ratings powerhouse with a strong competitive moat, evidenced by its dominant market position and exceptional profitability. However, its current stock price appears significantly above our estimated fair value, presenting a valuation challenge for value investors.
Read full analysis
Moody's operates two main segments: Moody's Investors Service (MIS), a leading credit ratings agency, and Moody's Analytics (MA), which provides financial intelligence and analytical tools. The company's core moat is exceptionally strong, likely scoring high on the GoodMoat framework. It benefits from immense switching costs and regulatory barriers as one of only two Nationally Recognized Statistical Rating Organizations (NRSROs) in the US, making its ratings mission-critical for debt markets. This is reflected in outstanding financial quality: an operating margin of 43.4%, an ROE of 60.7%, and a profit margin of 31.9%, all far exceeding typical high-quality thresholds. The business also demonstrates pricing power and a durable, recurring revenue model. Applying the Decision Framework, Moody's easily passes the Moat & Quality Gate with a high business score. The critical issue is valuation. The stock trades at a P/E of 31x and a price of $428.05, which is 32% above the GoodMoat Target of $324.33. This suggests a negative or minimal margin of safety. While the underlying business is excellent, the current price demands near-perfect future execution and leaves little room for error, making the setup unfavourable from a strict value perspective. Further investigation would focus on the sustainability of its growth and the justification for its premium multiple. Analysis based on data as of 2024-05-15.
Market Cap$83.26B
Current Price$466.72
P/E Ratio33.86
Forward P/E—
PEG Ratio0.60
EPS$13.67
Book Value$22.72
P/B Ratio20.54
MCO Financial Charts
FCF vs CAPEX
FCFCAPEX
Forward estimates use 8.2% FCF growth (CAGR)
Cash vs Debt
Net Debt: 5.0B
Revenue
4.8B
FY19
5.4B
FY20
6.2B
FY21
5.5B
FY22
5.9B
FY23
7.1B
FY24
7.7B
FY25
Net Income
1.4B
FY19
1.8B
FY20
2.2B
FY21
1.4B
FY22
1.6B
FY23
2.1B
FY24
2.5B
FY25
MCO 52-Week Range
$411.32
$538.42
50-Day MA: $443.95200-Day MA: $483.64
Did you know?
Free cash flow has been growing at 8.2% annually.
Moody`s Corp (MCO) Financial Summary
Moody`s Corp (MCO) is a Financial Services company in the Financial Data & Stock Exchanges industry, listed on NYSE. The stock currently trades at $466.72 with a market capitalization of $83.26B.
Key valuation metrics include a P/E ratio of 33.86, price-to-book ratio of 20.54, and EPS of $13.67. The company reports a profit margin of 31.9% and return on equity of 60.7%.
MCO Key Financial Metrics
| Metric | Value |
|---|---|
| Market Cap | $83.26B |
| P/E Ratio | 33.86 |
| EPS | $13.67 |
| P/B Ratio | 20.54 |
| P/S Ratio | 10.79 |
| EV/EBITDA | 23.08 |
| Dividend Yield | 0.84% |
| Profit Margin | 31.9% |
| Return on Equity | 60.7% |
| Debt/Equity | 1.81 |
MCO Revenue & Earnings History
| Year | Revenue | Net Income |
|---|---|---|
| FY19 | $4.83B | $1.42B |
| FY20 | $5.37B | $1.78B |
| FY21 | $6.22B | $2.21B |
| FY22 | $5.47B | $1.37B |
| FY23 | $5.92B | $1.61B |
| FY24 | $7.09B | $2.06B |
| FY25 | $7.72B | $2.46B |
Moody`s Corp (MCO) Valuation
Based on GoodMoat's DCF model, Moody`s Corp has a fair value estimate of $324.33. At the current price of $466.72, the stock appears 43.9% overvalued relative to our intrinsic value estimate.
MCO Quality Indicators
Moody`s Corp maintains a profit margin of 31.9% and an operating margin of 43.4%. Return on equity stands at 60.7%. The current ratio is 1.74. Debt-to-equity ratio is 1.81.
About Moody`s Corp
Moody's is an essential component of the global capital markets, providing credit ratings, research, tools and analysis that contribute to transparent and integrated financial markets. Moody’s Corporation is the parent company of Moody's Investors Service, which provides credit ratings and research covering debt instruments and securities, and Moody's Analytics, which offers leading-edge software, advisory services and research for credit and economic analysis and financial risk management. The corporation, which reported revenue of $4.4 billion in 2018, employs approximately 13,200 people worldwide and maintains a presence in 44 countries.
MCO Free Cash Flow
Moody`s Corp generated $2.58B in trailing twelve-month free cash flow, representing an FCF yield of 3.09%. This moderate FCF yield indicates reasonable cash generation.
MCO Shares Outstanding
Moody`s Corp has 0.18 billion shares outstanding at a share price of $466.72, giving it a market capitalization of $83.26B.
MCO Recent Insider Trades
Recent insider transactions at Moody`s Corp include:
| Insider | Type | Shares | Value |
|---|---|---|---|
| Fauber Robert (President and CEO) | SELL | 300 | $131331.00 |
| Steele Richard G (SVP - General Counsel) | SELL | 34 | $14884.18 |
| Phillips Jason D (Chief Acctg Off & Controller) | SELL | 333.12 | $157437.26 |