MOODY'S CORP (MCO) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:MCO - US6153691059 - Common Stock
524.04 USD
-6.2 (-1.17%)
523.88 USD
-0.16 (-0.03%)
Overall MCO gets a fundamental rating of 5 out of 10. We evaluated MCO against 237 industry peers in the Capital Markets industry. MCO scores excellent on profitability, but there are some minor concerns on its financial health. MCO is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
- In the past year MCO was profitable.
- MCO had a positive operating cash flow in the past year.
- In the past 5 years MCO has always been profitable.
- In the past 5 years MCO always reported a positive cash flow from operatings.
1.2 Ratios
- With an excellent Return On Assets value of 14.56%, MCO belongs to the best of the industry, outperforming 94.54% of the companies in the same industry.
- MCO has a better Return On Equity (56.71%) than 98.74% of its industry peers.
- MCO's Return On Invested Capital of 20.43% is amongst the best of the industry. MCO outperforms 96.64% of its industry peers.
- Measured over the past 3 years, the Average Return On Invested Capital for MCO is significantly above the industry average of 7.27%.
- The 3 year average ROIC (16.07%) for MCO is below the current ROIC(20.43%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 14.56% | ||
| ROE | 56.71% | ||
| ROIC | 20.43% |
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
- MCO's Profit Margin of 29.92% is fine compared to the rest of the industry. MCO outperforms 74.37% of its industry peers.
- In the last couple of years the Profit Margin of MCO has remained more or less at the same level.
- Looking at the Operating Margin, with a value of 43.81%, MCO is in the better half of the industry, outperforming 78.99% of the companies in the same industry.
- In the last couple of years the Operating Margin of MCO has remained more or less at the same level.
- Looking at the Gross Margin, with a value of 73.75%, MCO belongs to the top of the industry, outperforming 81.93% of the companies in the same industry.
- MCO's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 43.81% | ||
| PM (TTM) | 29.92% | ||
| GM | 73.75% |
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
- MCO has less shares outstanding than it did 1 year ago.
- The number of shares outstanding for MCO has been reduced compared to 5 years ago.
- The debt/assets ratio for MCO has remained at the same level compared to a year ago.
2.2 Solvency
- MCO has a debt to FCF ratio of 2.91. This is a good value and a sign of high solvency as MCO would need 2.91 years to pay back of all of its debts.
- MCO's Debt to FCF ratio of 2.91 is fine compared to the rest of the industry. MCO outperforms 79.41% of its industry peers.
- A Debt/Equity ratio of 1.76 is on the high side and indicates that MCO has dependencies on debt financing.
- With a Debt to Equity ratio value of 1.76, MCO is not doing good in the industry: 75.21% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.76 | ||
| Debt/FCF | 2.91 | ||
| Altman-Z | N/A |
ROIC/WACCN/A
WACCN/A
2.3 Liquidity
- A Current Ratio of 1.84 indicates that MCO should not have too much problems paying its short term obligations.
- MCO has a better Current ratio (1.84) than 72.27% of its industry peers.
- A Quick Ratio of 1.84 indicates that MCO should not have too much problems paying its short term obligations.
- MCO's Quick ratio of 1.84 is fine compared to the rest of the industry. MCO outperforms 72.27% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.84 | ||
| Quick Ratio | 1.84 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an nice 15.60% over the past year.
- The Earnings Per Share has been growing by 8.53% on average over the past years. This is quite good.
- MCO shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 8.77%.
- Measured over the past years, MCO shows a small growth in Revenue. The Revenue has been growing by 7.98% on average per year.
EPS 1Y (TTM)15.6%
EPS 3Y0.49%
EPS 5Y8.53%
EPS Q2Q%22.12%
Revenue 1Y (TTM)8.77%
Revenue growth 3Y4.46%
Revenue growth 5Y7.98%
Sales Q2Q%10.7%
3.2 Future
- Based on estimates for the next years, MCO will show a quite strong growth in Earnings Per Share. The EPS will grow by 12.76% on average per year.
- The Revenue is expected to grow by 7.37% on average over the next years.
EPS Next Y19.02%
EPS Next 2Y15.08%
EPS Next 3Y14.09%
EPS Next 5Y12.76%
Revenue Next Year8.41%
Revenue Next 2Y8.1%
Revenue Next 3Y8.04%
Revenue Next 5Y7.37%
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 37.62 indicates a quite expensive valuation of MCO.
- MCO's Price/Earnings ratio is a bit more expensive when compared to the industry. MCO is more expensive than 77.31% of the companies in the same industry.
- MCO's Price/Earnings ratio indicates a valuation a bit more expensive than the S&P500 average which is at 27.21.
- With a Price/Forward Earnings ratio of 31.70, MCO can be considered very expensive at the moment.
- Compared to the rest of the industry, the Price/Forward Earnings ratio of MCO indicates a slightly more expensive valuation: MCO is more expensive than 68.91% of the companies listed in the same industry.
- The average S&P500 Price/Forward Earnings ratio is at 25.98. MCO is valued slightly more expensive when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.62 | ||
| Fwd PE | 31.7 |
4.2 Price Multiples
- Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of MCO indicates a somewhat cheap valuation: MCO is cheaper than 67.65% of the companies listed in the same industry.
- MCO's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 38.99 | ||
| EV/EBITDA | 26.13 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
- The excellent profitability rating of MCO may justify a higher PE ratio.
- MCO's earnings are expected to grow with 14.09% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.98
PEG (5Y)4.41
EPS Next 2Y15.08%
EPS Next 3Y14.09%
5. Dividend
5.1 Amount
- With a yearly dividend of 0.71%, MCO is not a good candidate for dividend investing.
- MCO's Dividend Yield is slightly below the industry average, which is at 5.87.
- Compared to an average S&P500 Dividend Yield of 1.81, MCO's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.71% |
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
- 30.70% of the earnings are spent on dividend by MCO. This is a low number and sustainable payout ratio.
- The dividend of MCO is growing around the same rate as the earnings are growing. If this keeps up the dividend growth is sustainable.
DP30.7%
EPS Next 2Y15.08%
EPS Next 3Y14.09%
MOODY'S CORP / MCO FAQ
What is the ChartMill fundamental rating of MOODY'S CORP (MCO) stock?
ChartMill assigns a fundamental rating of 5 / 10 to MCO.
Can you provide the valuation status for MOODY'S CORP?
ChartMill assigns a valuation rating of 2 / 10 to MOODY'S CORP (MCO). This can be considered as Overvalued.
How profitable is MOODY'S CORP (MCO) stock?
MOODY'S CORP (MCO) has a profitability rating of 8 / 10.
What is the valuation of MOODY'S CORP based on its PE and PB ratios?
The Price/Earnings (PE) ratio for MOODY'S CORP (MCO) is 37.62 and the Price/Book (PB) ratio is 23.63.
Can you provide the dividend sustainability for MCO stock?
The dividend rating of MOODY'S CORP (MCO) is 4 / 10 and the dividend payout ratio is 30.7%.