MOODY'S CORP (MCO) Stock Fundamental Analysis
NYSE:MCO - New York Stock Exchange, Inc. - US6153691059 - Common Stock - Currency: USD
Overall MCO gets a fundamental rating of 6 out of 10. We evaluated MCO against 233 industry peers in the Capital Markets industry. MCO has an excellent profitability rating, but there are some minor concerns on its financial health. While showing a medium growth rate, MCO is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
MCO had positive earnings in the past year.
MCO had a positive operating cash flow in the past year.
In the past 5 years MCO has always been profitable.
Each year in the past 5 years MCO had a positive operating cash flow.
1.2 Ratios
MCO's Return On Assets of 13.95% is amongst the best of the industry. MCO outperforms 95.28% of its industry peers.
MCO has a better Return On Equity (56.92%) than 98.28% of its industry peers.
Looking at the Return On Invested Capital, with a value of 20.12%, MCO belongs to the top of the industry, outperforming 96.57% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for MCO is significantly above the industry average of 7.84%.
The 3 year average ROIC (16.07%) for MCO is below the current ROIC(20.12%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.95% | ||
| ROE | 56.92% | ||
| ROIC | 20.12% |
ROA(3y)11.28%
ROA(5y)12.65%
ROE(3y)53.57%
ROE(5y)71.04%
ROIC(3y)16.07%
ROIC(5y)17.25%
1.3 Margins
The Profit Margin of MCO (29.14%) is better than 73.39% of its industry peers.
MCO's Profit Margin has been stable in the last couple of years.
Looking at the Operating Margin, with a value of 42.24%, MCO is in the better half of the industry, outperforming 73.82% of the companies in the same industry.
MCO's Operating Margin has been stable in the last couple of years.
MCO has a better Gross Margin (72.75%) than 76.82% of its industry peers.
In the last couple of years the Gross Margin of MCO has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 42.24% | ||
| PM (TTM) | 29.14% | ||
| GM | 72.75% |
OM growth 3Y-2.8%
OM growth 5Y-0.46%
PM growth 3Y-6.57%
PM growth 5Y-0.28%
GM growth 3Y-0.51%
GM growth 5Y0.36%
2. Health
2.1 Basic Checks
Compared to 1 year ago, MCO has less shares outstanding
Compared to 5 years ago, MCO has less shares outstanding
MCO has about the same debt/assets ratio as last year.
2.2 Solvency
MCO has an Altman-Z score of 7.57. This indicates that MCO is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 7.57, MCO belongs to the best of the industry, outperforming 91.85% of the companies in the same industry.
The Debt to FCF ratio of MCO is 2.73, which is a good value as it means it would take MCO, 2.73 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 2.73, MCO belongs to the top of the industry, outperforming 81.12% of the companies in the same industry.
A Debt/Equity ratio of 1.84 is on the high side and indicates that MCO has dependencies on debt financing.
With a Debt to Equity ratio value of 1.84, MCO is not doing good in the industry: 78.11% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.84 | ||
| Debt/FCF | 2.73 | ||
| Altman-Z | 7.57 |
ROIC/WACCN/A
WACCN/A
2.3 Liquidity
A Current Ratio of 1.56 indicates that MCO should not have too much problems paying its short term obligations.
MCO has a better Current ratio (1.56) than 63.09% of its industry peers.
A Quick Ratio of 1.56 indicates that MCO should not have too much problems paying its short term obligations.
With a decent Quick ratio value of 1.56, MCO is doing good in the industry, outperforming 63.09% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.56 | ||
| Quick Ratio | 1.56 |
3. Growth
3.1 Past
MCO shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 25.75%, which is quite impressive.
MCO shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 8.53% yearly.
Looking at the last year, MCO shows a quite strong growth in Revenue. The Revenue has grown by 15.95% in the last year.
MCO shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 7.98% yearly.
EPS 1Y (TTM)25.75%
EPS 3Y0.49%
EPS 5Y8.53%
EPS Q2Q%13.65%
Revenue 1Y (TTM)15.95%
Revenue growth 3Y4.46%
Revenue growth 5Y7.98%
Sales Q2Q%7.73%
3.2 Future
The Earnings Per Share is expected to grow by 10.88% on average over the next years. This is quite good.
MCO is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 6.47% yearly.
EPS Next Y10.54%
EPS Next 2Y11.77%
EPS Next 3Y12.02%
EPS Next 5Y10.88%
Revenue Next Year4.38%
Revenue Next 2Y6.26%
Revenue Next 3Y6.83%
Revenue Next 5Y6.47%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 38.82 indicates a quite expensive valuation of MCO.
Based on the Price/Earnings ratio, MCO is valued a bit more expensive than the industry average as 75.11% of the companies are valued more cheaply.
When comparing the Price/Earnings ratio of MCO to the average of the S&P500 Index (27.29), we can say MCO is valued slightly more expensively.
MCO is valuated quite expensively with a Price/Forward Earnings ratio of 32.22.
Based on the Price/Forward Earnings ratio, MCO is valued a bit more expensive than 72.53% of the companies in the same industry.
MCO is valuated rather expensively when we compare the Price/Forward Earnings ratio to 21.74, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 38.82 | ||
| Fwd PE | 32.22 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, MCO is valued a bit cheaper than the industry average as 66.09% of the companies are valued more expensively.
The rest of the industry has a similar Price/Free Cash Flow ratio as MCO.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 36.21 | ||
| EV/EBITDA | 27.16 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
MCO has an outstanding profitability rating, which may justify a higher PE ratio.
MCO's earnings are expected to grow with 12.02% in the coming years. This may justify a more expensive valuation.
PEG (NY)3.68
PEG (5Y)4.55
EPS Next 2Y11.77%
EPS Next 3Y12.02%
5. Dividend
5.1 Amount
With a yearly dividend of 0.74%, MCO is not a good candidate for dividend investing.
MCO's Dividend Yield is slightly below the industry average, which is at 8.10.
Compared to an average S&P500 Dividend Yield of 2.37, MCO's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.74% |
5.2 History
The dividend of MCO is nicely growing with an annual growth rate of 11.37%!
MCO has paid a dividend for at least 10 years, which is a reliable track record.
The dividend of MCO decreased recently.
Dividend Growth(5Y)11.37%
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
31.34% of the earnings are spent on dividend by MCO. This is a low number and sustainable payout ratio.
MCO's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP31.34%
EPS Next 2Y11.77%
EPS Next 3Y12.02%
502.37
-2.69 (-0.53%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryCapital Markets
Earnings (Last)
Earnings (Next)
Inst Owners79.63%
Inst Owner Change0%
Ins Owners0.07%
Ins Owner Change0.88%
Market Cap90.38B
Analysts75.33
Price Target516.21 (2.75%)
Short Float %1.7%
Short Ratio3.91
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.74% |
Yearly Dividend3.42
Dividend Growth(5Y)11.37%
DP31.34%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)3.66%
Min EPS beat(2)0%
Max EPS beat(2)7.32%
EPS beat(4)3
Avg EPS beat(4)6.55%
Min EPS beat(4)0%
Max EPS beat(4)11.21%
EPS beat(8)6
Avg EPS beat(8)4.5%
EPS beat(12)8
Avg EPS beat(12)5.47%
EPS beat(16)10
Avg EPS beat(16)5.03%
Revenue beat(2)1
Avg Revenue beat(2)-0.71%
Min Revenue beat(2)-2.79%
Max Revenue beat(2)1.37%
Revenue beat(4)3
Avg Revenue beat(4)2.07%
Min Revenue beat(4)-2.79%
Max Revenue beat(4)5.41%
Revenue beat(8)5
Avg Revenue beat(8)1.58%
Revenue beat(12)7
Avg Revenue beat(12)0.57%
Revenue beat(16)11
Avg Revenue beat(16)1%
PT rev (1m)0.49%
PT rev (3m)-6.89%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-11.93%
EPS NY rev (1m)-0.15%
EPS NY rev (3m)-3.04%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-6.81%
Revenue NY rev (1m)-0.05%
Revenue NY rev (3m)-2.51%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 38.82 | ||
| Fwd PE | 32.22 | ||
| P/S | 12.51 | ||
| P/FCF | 36.21 | ||
| P/OCF | 32.05 | ||
| P/B | 24.43 | ||
| P/tB | N/A | ||
| EV/EBITDA | 27.16 |
EPS(TTM)12.94
EY2.58%
EPS(NY)15.59
Fwd EY3.1%
FCF(TTM)13.87
FCFY2.76%
OCF(TTM)15.68
OCFY3.12%
SpS40.17
BVpS20.57
TBVpS-25.1
PEG (NY)3.68
PEG (5Y)4.55
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.95% | ||
| ROE | 56.92% | ||
| ROCE | 25.06% | ||
| ROIC | 20.12% | ||
| ROICexc | 24.56% | ||
| ROICexgc | 139.02% | ||
| OM | 42.24% | ||
| PM (TTM) | 29.14% | ||
| GM | 72.75% | ||
| FCFM | 34.54% |
ROA(3y)11.28%
ROA(5y)12.65%
ROE(3y)53.57%
ROE(5y)71.04%
ROIC(3y)16.07%
ROIC(5y)17.25%
ROICexc(3y)20.2%
ROICexc(5y)21.81%
ROICexgc(3y)132.71%
ROICexgc(5y)140.15%
ROCE(3y)20.01%
ROCE(5y)21.48%
ROICexcg growth 3Y21.88%
ROICexcg growth 5Y10.45%
ROICexc growth 3Y6.4%
ROICexc growth 5Y0.62%
OM growth 3Y-2.8%
OM growth 5Y-0.46%
PM growth 3Y-6.57%
PM growth 5Y-0.28%
GM growth 3Y-0.51%
GM growth 5Y0.36%
F-Score8
Asset Turnover0.48
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.84 | ||
| Debt/FCF | 2.73 | ||
| Debt/EBITDA | 1.95 | ||
| Cap/Depr | 72.97% | ||
| Cap/Sales | 4.48% | ||
| Interest Coverage | 11.26 | ||
| Cash Conversion | 80.66% | ||
| Profit Quality | 118.52% | ||
| Current Ratio | 1.56 | ||
| Quick Ratio | 1.56 | ||
| Altman-Z | 7.57 |
F-Score8
WACCN/A
ROIC/WACCN/A
Cap/Depr(3y)77.23%
Cap/Depr(5y)66.52%
Cap/Sales(3y)4.74%
Cap/Sales(5y)3.68%
Profit Quality(3y)108.72%
Profit Quality(5y)105.07%
High Growth Momentum
Growth
EPS 1Y (TTM)25.75%
EPS 3Y0.49%
EPS 5Y8.53%
EPS Q2Q%13.65%
EPS Next Y10.54%
EPS Next 2Y11.77%
EPS Next 3Y12.02%
EPS Next 5Y10.88%
Revenue 1Y (TTM)15.95%
Revenue growth 3Y4.46%
Revenue growth 5Y7.98%
Sales Q2Q%7.73%
Revenue Next Year4.38%
Revenue Next 2Y6.26%
Revenue Next 3Y6.83%
Revenue Next 5Y6.47%
EBIT growth 1Y23.96%
EBIT growth 3Y1.54%
EBIT growth 5Y7.49%
EBIT Next Year17.6%
EBIT Next 3Y12.45%
EBIT Next 5Y10.13%
FCF growth 1Y89.81%
FCF growth 3Y10.55%
FCF growth 5Y9.44%
OCF growth 1Y74.94%
OCF growth 3Y12.28%
OCF growth 5Y11.12%