Moody's MCO
Moody's Corporation is a credit rating agency and financial analytics provider that generates revenue from subscriptions and fees for rating corporate and sovereign debt. Moody's shows exceptional quality with an ROE of 76.93% and an operating margin of 49.47%, supported by earnings growth of 56.70%. The valuation, with a P/E of 30.12, is demanding but consistent with its moat and cash generation. The rise in US rates is a factor to watch, but its moderate leverage (ND/EBITDA of 1.51) limits the impact.
Detailed metrics
Market and fundamental data as of the analysis date.
Full AI report
Generated automatically from the metrics, the macro context and the company's news.
Moody's Corporation is a credit rating agency and financial analytics provider that generates revenue from subscriptions and fees for rating corporate and sovereign debt. Moody's shows exceptional quality with an ROE of 76.93% and an operating margin of 49.47%, supported by earnings growth of 56.70%. The valuation, with a P/E of 30.12, is demanding but consistent with its moat and cash generation. The rise in US rates is a factor to watch, but its moderate leverage (ND/EBITDA of 1.51) limits the impact.
Score by category
| Category | Score |
|---|---|
| Financial health | 7.3 |
| Quality / Moat | 9.3 |
| Valuation | 5.2 |
| Growth | 8.5 |
| Dividend | 4.9 |
| Momentum | 5.6 |
| Risk & Context | 4.7 |
OVERALL SCORE: 6.9/10
Context and risks
Moody's credit rating and analysis business has no direct exposure to crude oil prices, shipping routes, or tariffs. The rise in US interest rates (10-year at 5.17%) is a relevant factor for the financial sector in general, but Moody's, with a Net Debt/EBITDA of 1.51, is not excessively leveraged, and its subscription and fee model is less sensitive to duration than a high-growth company without earnings. Therefore, the macro context has no material specific impact on this company.
News considered in the analysis
- Moody’s cuts Botswana credit rating to Baa2, shifts outlook to stable — Actividad rutinaria de calificación soberana; refuerza la posición de Moody's como agencia, pero no altera sus fundamentales.
- Moody’s lifts Montenegro’s credit rating to Ba2 amid institutional reforms — Acción de calificación soberana de bajo impacto individual; refleja el negocio recurrente de la compañía.
- Moody’s affirms European Union’s Aaa credit rating with stable outlook — Confirmación de calificación; sin impacto material en los resultados de Moody's.
- Moody’s affirms Fiji at B1 with stable outlook as savings cushion debt — Acción de calificación soberana menor; no aporta información nueva relevante para la valoración.
- These 4 Dividend Stocks Turn Customer Loyalty Into Growing Income — Listículo genérico sin información específica sobre Moody's; se ignora.
Verdict: Hold or buy on pullbacks; quality and growth justify the premium, but the valuation offers no margin of safety.
Main risk: The main risk is a slowdown in debt markets that reduces issuance and, therefore, rating fees, impacting revenue growth. Additionally, rising US rates could compress valuation multiples for a company with a high P/E.
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