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1. Company Snapshot

1.a. Company Description

Moody's Corporation operates as an integrated risk assessment firm worldwide.It operates in two segments, Moody's Investors Service and Moody's Analytics.The Moody's Investors Service segment publishes credit ratings and provides assessment services on various debt obligations, programs and facilities, and entities that issue such obligations, such as various corporate, financial institution, and governmental obligations, as well as and structured finance securities.


This segment provides ratings in approximately 140 countries.Its ratings are disseminated through press releases to the public through electronic media, including the internet and real-time information systems used by securities traders and investors.This segment has rated approximately 5,000 non-financial corporates; 3,600 financial institutions; 16,000 public finance issuers; 145 sovereigns; 47 supranational institutions; 459 sub-sovereigns; and 1,000 infrastructure and project finance issuers, as well as 9,100 structured finance deals.


The Moody's Analytics segment develops a range of products and services that support the risk management activities of institutional participants in financial markets; and offers subscription based research, data, and analytical products comprising credit ratings, credit research, quantitative credit scores and other analytical tools, economic research and forecasts, business intelligence and company information products, commercial real estate data and analytical tools, and on-line and classroom-based training services, as well as credentialing and certification services.It also offers offshore analytical and research services with learning solutions and certification programs; and software solutions, as well as related risk management services.The company was formerly known as Dun and Bradstreet Company and changed its name to Moody's Corporation in September 2000.


Moody's Corporation was founded in 1900 and is headquartered in New York, New York.

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1.b. Last Insights on MCO

Negative drivers behind Moody's Corporation's recent performance include the company's decision to lower its 2025 earnings targets due to market volatility and ambiguity. This move suggests that Moody's is cautious about the future, which may impact investor confidence. Additionally, the company's Q1 earnings beat was partly offset by a decline in revenue diversification efforts, as the segment experienced a 2% year-over-year decrease. Furthermore, Moody's has faced challenges in its credit ratings business, with a decline in the number of new credit ratings issued.

1.c. Company Highlights

2. Moody's Beats Expectations with Record Quarterly Revenue

Moody's Corporation reported record quarterly revenue of over $2 billion for Q3 2025, up 11% from Q3 2024. The company's adjusted operating margin was 53%, up over 500 basis points from a year ago, and adjusted diluted EPS was $3.92, up 22%. The ratings business, MIS, delivered 12% revenue growth, surpassing $1 billion in quarterly revenue for the third consecutive quarter. The actual EPS of $3.92 beat analyst estimates of $3.7, indicating strong performance.

Publication Date: Oct -23

📋 Highlights
  • Record Revenue Growth:: Q3 2025 revenue hit $2.0B, up 11% YoY, with adjusted operating margin at 53% (560 bps expansion for MIS to 65.2%).
  • MIS Momentum:: Ratings business revenue grew 12%, surpassing $1B quarterly for the third consecutive quarter, with full-year guidance raised to 63-64% adjusted margin.
  • Private Credit Expansion:: Revenue tied to private credit surged >60% in Q3, driven by robust demand and a $5T+ refinancing pipeline over 4 years (10% CAGR from 2018-2025).
  • Strategic Acquisitions & Partnerships:: Acquired majority stake in Egyptian ratings agency MIRAS; partnered with Salesforce to integrate GenAI-ready data into AgentForce 360.
  • Free Cash Flow & Guidance:: Raised full-year free cash flow forecast to $2.5B, with $1.5B+ in share repurchases and high-single-digit revenue growth expected for MCO.

Business Segment Performance

The ratings business, MIS, saw revenue growth across all ratings lines of business, contributing to a 12% increase in revenue. Moody's Analytics delivered 9% year-over-year revenue growth, including 11% in Decision Solutions. ARR is nearly $3.4 billion, up 8% versus last year. The company increased its full-year margin outlook for MA to approximately 33%. Private credit continues to be a growth driver for ratings, with revenue tied to private credit growing over 60% in Q3.

Guidance and Outlook

The company raised its full-year guidance across almost all metrics, citing a robust issuance pipeline and solid demand. Moody's expects mid-single-digit issuance growth for 2025, with notable updates in investment grade, leveraged loan, and high-yield bond issuance. M&A activity is expected to contribute positively, with a forecast of 15-20% growth in M&A issuance. The company now expects MCO revenue to grow in the high single-digit percent range.

Valuation and Growth Prospects

With a P/E Ratio of 37.82 and an EV/EBITDA of 24.82, the market is pricing in significant growth prospects. Analysts estimate next year's revenue growth at 8.5%. The company's ROE is 59.17%, indicating strong profitability. The current levels of growth across the G20 are generally sustainable into next year, and the default rates are expected to continue declining. Moody's is well-positioned to serve investors and issuers, with a massive, mostly proprietary data and analytics estate.

Strategic Developments

The company signed a definitive agreement to acquire a majority interest in MIRAS, deepening Moody's presence in The Middle East and Africa. Additionally, Moody's partnered with Salesforce to make available its proprietary GenAI-ready data and analytics within Salesforce's AgentForce 360. The acquisition of RMS is also showing promising results, with wins with large banks using RMS models to understand physical risk of extreme events.

3. NewsRoom

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BBSEY vs. MCO: Which Stock Should Value Investors Buy Now?

Dec -04

Source: zacks.com

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Moody’s Corporation $MCO Shares Sold by Arrowstreet Capital Limited Partnership

Dec -04

Source: defenseworld.net

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Edgestream Partners L.P. Acquires 1,108 Shares of Moody’s Corporation $MCO

Dec -04

Source: defenseworld.net

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Moody’s Corporation (NYSE:MCO) Receives Consensus Rating of “Moderate Buy” from Brokerages

Dec -04

Source: defenseworld.net

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Pega and Moody's Collaborate to Streamline Customer Lifecycle Management and KYC Processes for Financial Services

Dec -02

Source: businesswire.com

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Buy 5 Financial Technology Ginats Amid Fed Rate Cut Hope in December

Nov -28

Source: zacks.com

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Bell Asset Management Ltd Sells 1,950 Shares of Moody’s Corporation $MCO

Nov -27

Source: defenseworld.net

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Entegra to Integrate Moody's Data, Advancing Data-Driven Insight in Structured-Credit Markets

Nov -24

Source: businesswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.10%)

6. Segments

Moody's Investors Service (MIS)

Expected Growth: 7.5%

MIS is expected to grow at a slightly lower rate than the global average due to potential regulatory pressures and market competition. However, its strong brand and the essential nature of its services will support steady growth. The growth rate is slightly lower than the global average due to these factors.

Moody's Analytics (MA)

Expected Growth: 9.0%

MA is poised for higher growth due to the increasing demand for advanced financial analytics, risk management tools, and the digital transformation in the financial services sector. The segment is well-positioned to capitalize on these trends, driving its growth above the global average.

Eliminations

Expected Growth: None%

None

7. Detailed Products

Credit Ratings

Moody's credit ratings provide an independent opinion on the credit quality of issuers and their debt securities, helping investors make informed investment decisions.

Research and Analytics

Moody's research and analytics provide in-depth analysis and insights on credit markets, economies, and industries, helping investors and businesses make informed decisions.

Risk Management Solutions

Moody's risk management solutions provide tools and services to help businesses and investors identify, assess, and manage credit risk, market risk, and operational risk.

ESG (Environmental, Social, and Governance) Solutions

Moody's ESG solutions provide data, analytics, and insights on environmental, social, and governance factors, helping investors and businesses make sustainable investment decisions.

KYC (Know Your Customer) and AML (Anti-Money Laundering) Solutions

Moody's KYC and AML solutions provide tools and services to help businesses comply with anti-money laundering and know-your-customer regulations.

Commercial Credit Scores

Moody's commercial credit scores provide a numerical representation of a company's creditworthiness, helping businesses and investors make informed credit decisions.

Data and Analytics Platforms

Moody's data and analytics platforms provide access to a wide range of credit, economic, and financial data, helping businesses and investors make informed decisions.

8. Moody's Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

Moody's Corporation has a low threat of substitutes due to its strong brand recognition and high barriers to entry in the credit rating industry.

Bargaining Power Of Customers

Moody's Corporation has a medium bargaining power of customers due to the presence of large institutional investors and a relatively concentrated customer base.

Bargaining Power Of Suppliers

Moody's Corporation has a low bargaining power of suppliers due to its ability to source data and information from a diverse range of providers.

Threat Of New Entrants

Moody's Corporation has a low threat of new entrants due to the high barriers to entry in the credit rating industry, including regulatory hurdles and the need for significant investment in infrastructure and talent.

Intensity Of Rivalry

Moody's Corporation operates in a highly competitive industry with intense rivalry among the major credit rating agencies, including S&P Global and Fitch Ratings.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 68.18%
Debt Cost 4.24%
Equity Weight 31.82%
Equity Cost 10.43%
WACC 6.21%
Leverage 214.26%

11. Quality Control: Moody's Corporation passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
CME Group

A-Score: 7.1/10

Value: 2.0

Growth: 5.9

Quality: 8.5

Yield: 8.0

Momentum: 8.0

Volatility: 10.0

1-Year Total Return ->

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Stock-Card
Nasdaq

A-Score: 5.7/10

Value: 2.2

Growth: 5.8

Quality: 6.7

Yield: 3.0

Momentum: 7.0

Volatility: 9.7

1-Year Total Return ->

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Stock-Card
ICE

A-Score: 5.4/10

Value: 2.7

Growth: 6.1

Quality: 6.7

Yield: 2.0

Momentum: 5.0

Volatility: 10.0

1-Year Total Return ->

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Stock-Card
MSCI

A-Score: 5.3/10

Value: 2.8

Growth: 7.9

Quality: 7.6

Yield: 2.0

Momentum: 4.0

Volatility: 7.7

1-Year Total Return ->

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Stock-Card
Moody's

A-Score: 5.1/10

Value: 0.8

Growth: 6.2

Quality: 7.9

Yield: 2.0

Momentum: 5.0

Volatility: 8.7

1-Year Total Return ->

View Full Report
Stock-Card
S&P Global

A-Score: 5.1/10

Value: 1.5

Growth: 6.7

Quality: 8.0

Yield: 1.0

Momentum: 4.0

Volatility: 9.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

496.5$

Current Price

496.5$

Potential

-0.00%

Expected Cash-Flows