MSCI’s 3Q Profit Outperforms Amid Trading Boom

Shares of MSCI increased 2.1% on Tuesday after the stock market index and multi-asset portfolio analysis provider reported better-than-expected 3Q results. Its 3Q adjusted EPS climbed 31% to $2.20 year-on-year and surpassed analysts’ expectations of $1.80.

MSCI’s (MSCI) 3Q revenues increased 7.9% to $425.3 million year-over-year and beat Street estimates of $422.7 million. The increase in top-line reflects higher recurring subscription and additional non-recurring revenues, and surge in asset-based fees.

MSCI’s CEO said, “In the midst of a global pandemic which has resulted in economic turmoil and significant changes in how we and our clients work, we are proud of our teams delivery of another quarter of over 10% growth in recurring subscription Run Rate. MSCIs third quarter results reflect our clients continued demand for our mission-critical solutions and the resilience of our franchise.” (See MSCI stock analysis on TipRanks).

Following its quarterly results, Oppenheimer analyst Owen Lau reiterated a Buy rating and a price target of $416 (16.6% upside potential). In a note to investors on October 27, Lau wrote, “we believe that the long-term secular growth trends and current underlying growth drivers should provide MSCI with strong organic revenue growth.”

Currently, the Street is cautiously optimistic on the stock with a Moderate Buy analyst consensus. The average price target of $391.67 implies upside potential of about 9.7% to current levels. Shares are marginally down by 0.4% year-to-date.

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