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Moody's
(NYSE:MCO)
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Rating:72Outperform
Price Target:
$528.00
▲(3.73% Upside)
Action:Reiterated
Date:10/21/26
The score reflects strong financial performance (high margins and solid cash generation) reinforced by a constructive earnings outlook and durable recurring-revenue growth, partially offset by elevated leverage risk, a premium valuation (P/E ~30), and only mixed-to-moderate technical momentum.
Positive Factors
Recurring Analytics Revenue
The Analytics segment’s high recurring mix, strong retention, and ARR growth provide durable revenue visibility beyond debt-market issuance cycles. Embedded data and software workflows can deepen customer relationships, support cross-selling, and improve the resilience of consolidated earnings over the next several quarters.
Negative Factors
Elevated and Rising Leverage
Higher leverage reduces financial flexibility and makes the business more sensitive to weaker operating conditions or refinancing pressure. Although cash generation is strong, rising debt relative to equity can constrain capital allocation and amplify downside if issuance activity deteriorates.
Read all positive and negative factors
Positive Factors
Negative Factors
Recurring Analytics Revenue
The Analytics segment’s high recurring mix, strong retention, and ARR growth provide durable revenue visibility beyond debt-market issuance cycles. Embedded data and software workflows can deepen customer relationships, support cross-selling, and improve the resilience of consolidated earnings over the next several quarters.
Read all positive factors
Moody's Key Performance Indicators (KPIs)
Any
Revenue by Geography
Revenue split across regions (U.S., EMEA, APAC) reveals where Moody’s earns most and how exposed it is to local credit cycles, regulatory environments, and regional growth opportunities.
Revenue split across regions (U.S., EMEA, APAC) reveals where Moody’s earns most and how exposed it is to local credit cycles, regulatory environments, and regional growth opportunities.
Data provided by:
The Fly
The FlyMoody's (MCO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$82.33B
Dividend Yield0.84%
Average Volume (3M)794.41K
Price to Earnings (P/E)29.2
Beta (1Y)1.08
Revenue Growth9.00%
EPS Growth31.83%
CountryUS
Employees16,076
SectorFinancial
Sector Strength70
IndustryFinancial - Data & Stock Exchanges
Share Statistics
EPS (TTM)16.45
Shares Outstanding173,200,000
10 Day Avg. Volume686,134
30 Day Avg. Volume794,406
Financial Highlights & Ratios
PEG Ratio1.75
Price to Book (P/B)22.57
Price to Sales (P/S)11.85
P/FCF Ratio35.53
Enterprise Value/Market Cap1.03
Enterprise Value/Revenue10.36
Enterprise Value/Gross Profit14.17
Enterprise Value/Ebitda21.99
Forecast
1Y Price Target
$555.07Price Target Upside9.05% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering15
EPS Forecast (FY)16.79
Revenue Forecast (FY)$8.24B
Moody's Business Overview & Revenue Model
Company Description
Moody's Corporation operates as a global leader in risk assessment, divided into two main segments: Moody's Investors Service and Moody's Analytics. Moody's Investors Service is dedicated to issuing credit ratings and providing detailed assessment...
How the Company Makes Money
Moody’s makes money primarily by selling (1) credit ratings and related services and (2) subscription-based analytics, data, and software solutions.
1) Moody’s Investors Service (MIS) – ratings and related revenue
- Issuer-paid credit ratings: A ...
Moody's Earnings Call Summary
Earnings Call Date:Oct 21, 2026
(Q3-2026)
| % Change Since: |
Next Earnings Date:Feb 05, 2027
Earnings Call Sentiment Positive
The call was predominantly positive. Moody's reported strong profitability, recurring revenue growth, record or near-record activity in several ratings areas, accelerating AI adoption, expanding customer relationships, strong cash generation, and reaffirmed full-year guidance. These strengths were partly offset by declines in overall issuance, leveraged finance, MIS transaction revenue, MA transactional revenue, and the expected mid-teens fourth-quarter issuance decline, along with macro and market-volatility risks.Positive Updates
Strong Quarterly Profitability and Earnings Growth
Moody's topped $2 billion in revenue for the third straight quarter and built on a record quarter from last year. Despite overall rated issuance declining 2%, adjusted operating margin was 52.6% and adjusted diluted EPS grew 6%.
Negative Updates
Overall Rated Issuance Declined
Overall rated issuance declined 2% year-over-year to approximately $1.7 trillion, reflecting softer activity in certain asset classes despite remaining the second-highest third-quarter level on record.
Read all updates
Q3-2026 Updates
Positive
Negative
Strong Quarterly Profitability and Earnings Growth
Moody's topped $2 billion in revenue for the third straight quarter and built on a record quarter from last year. Despite overall rated issuance declining 2%, adjusted operating margin was 52.6% and adjusted diluted EPS grew 6%.
Read all positive updates
Company Guidance
Moody’s reaffirmed its full year guidance, including overall issuance growth at mid-single digit percent growth, MIS revenue growth in the high single-digit percent range, MA ARR growth in the high single-digit percent range and adjusted operating margin of 34%-35%, and MCO revenue growth in the high single digit % range, adjusted operating margin of 52%-53%, and adjusted diluted EPS of $16.50-$17, representing 12% growth at the midpoint; MIS fourth quarter issuance is expected to decline in the mid-teens percent versus the prior year, with MIS revenue declining sequentially versus the third quarter while growing in the low single-digit percent range versus the prior year, and full year first time mandates guidance was raised to a range of 900 to 950; full year expense growth is expected to be mid-single digit %, share repurchases are expected to be up to $3 billion, and Moody’s remains on track to return more than 130% of free cash flow to shareholders this year.Moody's Financial Statement Overview
Summary
Income Statement
88
Very Positive
Balance Sheet
62
Positive
Cash Flow
79
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 8.18B | 7.72B | 7.09B | 5.92B | 5.47B | 6.22B |
| Gross Profit | 5.98B | 5.26B | 4.71B | 3.85B | 3.52B | 4.32B |
| EBITDA | 3.85B | 3.94B | 3.33B | 2.52B | 2.31B | 3.25B |
| Net Income | 2.88B | 2.46B | 2.06B | 1.61B | 1.37B | 2.21B |
Balance Sheet | ||||||
| Total Assets | 14.83B | 15.83B | 15.51B | 14.62B | 14.35B | 14.68B |
| Cash, Cash Equivalents and Short-Term Investments | 1.62B | 2.45B | 2.97B | 2.19B | 1.86B | 1.90B |
| Total Debt | 7.49B | 7.35B | 7.75B | 7.42B | 7.86B | 7.97B |
| Total Liabilities | 11.42B | 11.63B | 11.78B | 11.15B | 11.66B | 11.76B |
| Stockholders Equity | 3.27B | 4.05B | 3.56B | 3.32B | 2.52B | 2.73B |
Cash Flow | ||||||
| Free Cash Flow | 3.25B | 2.58B | 2.52B | 1.88B | 1.19B | 1.87B |
| Operating Cash Flow | 3.33B | 2.90B | 2.84B | 2.15B | 1.47B | 2.00B |
| Investing Cash Flow | -172.00M | 2.00M | -1.06B | -247.00M | -262.00M | -2.62B |
| Financing Cash Flow | -3.80B | -3.06B | -1.45B | -1.58B | -1.21B | -122.00M |
Moody's Technical Analysis
Positive
509.02
Price Trends
477.63
Positive
474.40
Positive
467.06
Positive
Market Momentum
1.89
Negative
57.02
Neutral
67.96
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MCO, the sentiment is Positive. The current price of 509.02 is above the 20-day moving average (MA) of 463.53, above the 50-day MA of 477.63, and above the 200-day MA of 467.06, indicating a bullish trend. The MACD of 1.89 indicates Negative momentum. The RSI at 57.02 is Neutral, neither overbought nor oversold. The STOCH value of 67.96 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MCO.
Moody's Risk Analysis
Moody's disclosed 18 risk factors in its most recent earnings report. Moody's reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Moody's Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
79 Outperform | $130.64B | 26.97 | 15.47% | 0.87% | 9.67% | 26.18% | |
75 Outperform | $14.99B | 20.61 | 18.32% | 0.62% | 12.37% | 90.36% | |
73 Outperform | $11.11B | 21.88 | 25.61% | 1.41% | 6.65% | -7.20% | |
73 Outperform | $7.94B | 20.15 | 35.29% | 0.94% | 9.33% | 12.16% | |
72 Outperform | $82.33B | 29.23 | 86.44% | 0.84% | 9.00% | 31.83% | |
72 Outperform | $43.02B | 32.15 | -49.71% | 1.32% | 12.33% | 19.69% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% |
* Financial Sector Average
MCO
Moody's
481.05
5.87
1.24%
FDS
Factset Research
319.91
38.12
13.53%
SPGI
S&P Global
443.16
-9.38
-2.07%
MORN
Morningstar
213.79
-1.94
-0.90%
MSCI
MSCI
604.46
73.34
13.81%
TRU
TransUnion
78.93
-4.02
-4.85%
Moody's Corporate Events
Business Operations and StrategyFinancial Disclosures
Moody’s Reports Strong Q3 Earnings and Cash Generation
Positive
Oct 21, 2026
On October 21, 2026, Moody’s reported third-quarter 2026 results showing modest top-line growth but robust earnings and cash generation, with revenue up 1% year-on-year to $2.0 billion and diluted EPS rising 18%. Operating cash flow climbed ...
Business Operations and StrategyExecutive/Board Changes
Moody’s Adds Insurance Leader Keith Demmings to Board
Positive
Aug 12, 2026
On August 12, 2026, Moody’s Corporation announced the election of Keith Demmings, President and Chief Executive Officer of Assurant, Inc., to its Board of Directors, effective November 1, 2026. Demmings, who has nearly 30 years of leadership...
Business Operations and StrategyStock BuybackFinancial Disclosures
Moody’s posts strong Q2 results, raises buyback plans
Positive
Jul 22, 2026
Moody’s Corporation reported strong second-quarter 2026 results on July 22, 2026, with revenue rising 15% year-on-year to $2.19 billion and operating margin expanding to 47.9%. Diluted EPS jumped 57% while adjusted diluted EPS increased 31%,...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.