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GuruFocus Financial Strength Rank measures how strong a company’s financial situation is. It is based on these factors

1. The debt burden that the company has as measured by its Interest coverage (current year).
2. Debt to revenue ratio. The lower, the better
3. Altman Z-score.

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

Financial Strength : 8/10

vs
industry
vs
history
Cash to Debt 0.66
MCO's Cash to Debt is ranked higher than
57% of the 1070 Companies
in the Global Business Services industry.

( Industry Median: 1.10 vs. MCO: 0.66 )
MCO' s 10-Year Cash to Debt Range
Min: 0.09   Max: No Debt
Current: 0.66

Equity to Asset -0.04
MCO's Equity to Asset is ranked lower than
65% of the 991 Companies
in the Global Business Services industry.

( Industry Median: 0.45 vs. MCO: -0.04 )
MCO' s 10-Year Equity to Asset Range
Min: -0.81   Max: 0.23
Current: -0.04

-0.81
0.23
Interest Coverage 11.59
MCO's Interest Coverage is ranked lower than
51% of the 694 Companies
in the Global Business Services industry.

( Industry Median: 25.65 vs. MCO: 11.59 )
MCO' s 10-Year Interest Coverage Range
Min: 10.64   Max: 9999.99
Current: 11.59

10.64
9999.99
F-Score: 6
Z-Score: 6.68
M-Score: -2.39
WACC vs ROIC
12.15%
177.27%
WACC
ROIC
GuruFocus Profitability Rank ranks how profitable a company is and how likely the company’s business will stay that way. It is based on these factors:

1. Operating Margin
2. Trend of the Operating Margin (5-year average). The company with an uptrend profit margin has a higher rank.
••3. Consistency of the profitability
4. Piotroski F-Score
5. Predictability Rank•

The maximum rank is 10. A rank of 7 or higher means a higher profitability and may stay that way. A rank of 3 or lower indicates that the company has had trouble to make a profit.

Profitability Rank is not directly related to the Financial Strength Rank. But if a company is consistently profitable, its financial strength will be stronger.

Profitability & Growth : 8/10

vs
industry
vs
history
Operating margin (%) 43.16
MCO's Operating margin (%) is ranked higher than
98% of the 1057 Companies
in the Global Business Services industry.

( Industry Median: 6.32 vs. MCO: 43.16 )
MCO' s 10-Year Operating margin (%) Range
Min: 38.03   Max: 61.83
Current: 43.16

38.03
61.83
Net-margin (%) 29.65
MCO's Net-margin (%) is ranked higher than
97% of the 1059 Companies
in the Global Business Services industry.

( Industry Median: 4.17 vs. MCO: 29.65 )
MCO' s 10-Year Net-margin (%) Range
Min: 22.37   Max: 37.01
Current: 29.65

22.37
37.01
ROE (%) 401.71
MCO's ROE (%) is ranked higher than
100% of the 1024 Companies
in the Global Business Services industry.

( Industry Median: 9.41 vs. MCO: 401.71 )
MCO' s 10-Year ROE (%) Range
Min: 178.91   Max: 1325.34
Current: 401.71

178.91
1325.34
ROA (%) 21.31
MCO's ROA (%) is ranked higher than
97% of the 1074 Companies
in the Global Business Services industry.

( Industry Median: 3.87 vs. MCO: 21.31 )
MCO' s 10-Year ROA (%) Range
Min: 15.08   Max: 51.03
Current: 21.31

15.08
51.03
ROC (Joel Greenblatt) (%) 491.13
MCO's ROC (Joel Greenblatt) (%) is ranked higher than
96% of the 1060 Companies
in the Global Business Services industry.

( Industry Median: 28.69 vs. MCO: 491.13 )
MCO' s 10-Year ROC (Joel Greenblatt) (%) Range
Min: 252.43   Max: 2145.66
Current: 491.13

252.43
2145.66
Revenue Growth (3Y)(%) 16.00
MCO's Revenue Growth (3Y)(%) is ranked higher than
88% of the 827 Companies
in the Global Business Services industry.

( Industry Median: 5.70 vs. MCO: 16.00 )
MCO' s 10-Year Revenue Growth (3Y)(%) Range
Min: 1.2   Max: 30.3
Current: 16

1.2
30.3
EBITDA Growth (3Y)(%) 22.30
MCO's EBITDA Growth (3Y)(%) is ranked higher than
87% of the 710 Companies
in the Global Business Services industry.

( Industry Median: 6.30 vs. MCO: 22.30 )
MCO' s 10-Year EBITDA Growth (3Y)(%) Range
Min: -11   Max: 35.8
Current: 22.3

-11
35.8
EPS Growth (3Y)(%) 22.80
MCO's EPS Growth (3Y)(%) is ranked higher than
83% of the 643 Companies
in the Global Business Services industry.

( Industry Median: 7.00 vs. MCO: 22.80 )
MCO' s 10-Year EPS Growth (3Y)(%) Range
Min: -13.2   Max: 34.4
Current: 22.8

-13.2
34.4
» MCO's 10-Y Financials

Financials


Revenue & Net Income
Cash & Debt
Oprt. Cash Flow & Free Cash Flow

» Details

Guru Trades

Q1 2014

MCO Guru Trades in Q1 2014

Joel Greenblatt 3,785 sh (New)
Tom Gayner 207,000 sh (+16.69%)
Chuck Akre 3,482,130 sh (+0.03%)
Eric Mindich 2,000,000 sh (unchged)
Dodge & Cox 4,300 sh (unchged)
Warren Buffett 24,669,778 sh (unchged)
Ray Dalio Sold Out
Jim Simons 1,598,900 sh (-10.30%)
MS Global Franchise Fund 145,756 sh (-15.40%)
Lou Simpson 1,510,532 sh (-24.81%)
Steven Cohen 7,990 sh (-30.62%)
Jeremy Grantham 77,316 sh (-39.65%)
Chuck Royce 49,845 sh (-64.85%)
Warren Buffett 24,669,778 sh (-1.01%)
» More
Q2 2014

MCO Guru Trades in Q2 2014

Chris Davis 2,406,257 sh (New)
Joel Greenblatt 5,876 sh (+55.24%)
Tom Gayner 227,000 sh (+9.66%)
Dodge & Cox 4,300 sh (unchged)
Warren Buffett 24,669,778 sh (unchged)
Chuck Akre 3,482,130 sh (unchged)
Eric Mindich Sold Out
Lou Simpson 1,507,599 sh (-0.19%)
MS Global Franchise Fund 121,510 sh (-16.63%)
Jim Simons 1,259,800 sh (-21.21%)
Chuck Royce 34,625 sh (-30.53%)
Jeremy Grantham 41,406 sh (-46.45%)
» More
Q3 2014

MCO Guru Trades in Q3 2014

John Burbank 482,118 sh (New)
Ken Fisher 6,580 sh (New)
Jeremy Grantham 56,406 sh (+36.23%)
Tom Gayner 242,000 sh (+6.61%)
Warren Buffett 24,669,778 sh (unchged)
Dodge & Cox 4,300 sh (unchged)
Chuck Akre 3,480,545 sh (-0.05%)
Lou Simpson 1,501,018 sh (-0.44%)
Chris Davis 2,395,195 sh (-0.46%)
MS Global Franchise Fund 109,960 sh (-9.51%)
Jim Simons 956,400 sh (-24.08%)
Joel Greenblatt 4,156 sh (-29.27%)
Chuck Royce 525 sh (-98.48%)
» More
Q4 2014

MCO Guru Trades in Q4 2014

Paul Tudor Jones 9,069 sh (New)
Tom Gayner 254,000 sh (+4.96%)
Joel Greenblatt 4,235 sh (+1.90%)
Chuck Akre 3,519,180 sh (+1.11%)
Chuck Royce 525 sh (unchged)
Dodge & Cox 4,300 sh (unchged)
Warren Buffett 24,669,778 sh (unchged)
Ken Fisher Sold Out
Lou Simpson Sold Out
Chris Davis 2,381,270 sh (-0.58%)
Jeremy Grantham 47,600 sh (-15.61%)
John Burbank 383,778 sh (-20.40%)
MS Global Franchise Fund 60,775 sh (-44.73%)
Jim Simons 478,500 sh (-49.97%)
» More
» Details

Insider Trades

Latest Guru Trades with MCO

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Guru Investment Theses on Moody's Corporation

Chuck Akre Comments on Moody’s Corporation - Jul 23, 2014

Moody’s Corporation (“Moody’s”) (NYSE: MCO)

Market Cap: $18.7 billion (as of 6/30/14)

Company overview:

Founded in 1900, Moody’s (MCO) is a global provider of credit rating opinions, insight, and tools for financial risk measurement and management. The company has two reporting segments: Moody’s Investor Services (the ratings business, 70% of revenue) and Moody’s Analytics (30% of revenue, includes credit and economic analysis subscriptions, risk analytics, financial and regulatory compliance tools, and certification services). We consider Moody’s ratings business a quintessential “toll-bridge,” earning fees from debt issuers of all kinds to provide efficient access to the debt capital markets.

Akre Focus Fund Investment:

Our initial investment in Moody’s was made in January of 2012 and we have added as periodic headline events - litigation, regulation (often overblown or misunderstood) - have presented opportunities to add to our investment at attractive valuations. As of June 2014 Moody’s represented 8.3 % of the portfolio.

Investment thesis:

Moody’s ratings business is exceptional, with proven pricing power, tremendous barriers to entry, high margins (operating margin averaged 46% from 2008 to 2012), and requires little investment capital to grow. Following the 2008 financial crisis, Moody’s was widely criticized for its role, for reasons both real and perceived. Investigations, litigation, and regulatory reviews ensued and Moody’s stock price plummeted. Our thesis deviates from popular perception in that we consider Moody’s global dominance and the oligopolic structure of the ratings industry to be the result of market forces, not regulation. We believe that those same market forces will see Moody’s through the post-crisis period with its “toll-bridge” status intact along with the potential for continued upward revaluation of the stock.

From Chuck Akre (Trades, Portfolio)’s 2014 Q2 Fund Pitchbook .

Check out Chuck Akre latest stock trades

Top Ranked Articles about Moody's Corporation

Chuck Akre Comments on Moody’s Corporation
Moody’s Corporation (“Moody’s”) (NYSE: MCO) Read more...

Ratios

vs
industry
vs
history
P/E(ttm) 22.40
MCO's P/E(ttm) is ranked higher than
75% of the 1279 Companies
in the Global Business Services industry.

( Industry Median: 43.10 vs. MCO: 22.40 )
MCO' s 10-Year P/E(ttm) Range
Min: 9.02   Max: 37
Current: 22.4

9.02
37
Forward P/E 20.37
MCO's Forward P/E is ranked higher than
78% of the 1279 Companies
in the Global Business Services industry.

( Industry Median: 0.00 vs. MCO: 20.37 )
N/A
PE(NRI) 22.90
MCO's PE(NRI) is ranked higher than
77% of the 1279 Companies
in the Global Business Services industry.

( Industry Median: 41.30 vs. MCO: 22.90 )
MCO' s 10-Year PE(NRI) Range
Min: 9.02   Max: 36.93
Current: 22.9

9.02
36.93
P/S 6.70
MCO's P/S is ranked lower than
62% of the 1279 Companies
in the Global Business Services industry.

( Industry Median: 2.02 vs. MCO: 6.70 )
MCO' s 10-Year P/S Range
Min: 2.24   Max: 12.19
Current: 6.7

2.24
12.19
PFCF 23.50
MCO's PFCF is ranked higher than
72% of the 1279 Companies
in the Global Business Services industry.

( Industry Median: 69.17 vs. MCO: 23.50 )
MCO' s 10-Year PFCF Range
Min: 8.14   Max: 32.93
Current: 23.5

8.14
32.93
POCF 22.15
MCO's POCF is ranked higher than
67% of the 1279 Companies
in the Global Business Services industry.

( Industry Median: 21.39 vs. MCO: 22.15 )
MCO' s 10-Year POCF Range
Min: 7   Max: 31.34
Current: 22.15

7
31.34
EV-to-EBIT 15.34
MCO's EV-to-EBIT is ranked higher than
77% of the 1279 Companies
in the Global Business Services industry.

( Industry Median: 24.26 vs. MCO: 15.34 )
MCO' s 10-Year EV-to-EBIT Range
Min: 6.3   Max: 21.9
Current: 15.34

6.3
21.9
PEG 1.14
MCO's PEG is ranked higher than
95% of the 1279 Companies
in the Global Business Services industry.

( Industry Median: 0.00 vs. MCO: 1.14 )
MCO' s 10-Year PEG Range
Min: 0.5   Max: 15.91
Current: 1.14

0.5
15.91
Shiller P/E 34.90
MCO's Shiller P/E is ranked higher than
78% of the 1279 Companies
in the Global Business Services industry.

( Industry Median: 0.00 vs. MCO: 34.90 )
MCO' s 10-Year Shiller P/E Range
Min: 7.9   Max: 59.61
Current: 34.9

7.9
59.61
Current Ratio 2.24
MCO's Current Ratio is ranked higher than
80% of the 1012 Companies
in the Global Business Services industry.

( Industry Median: 1.43 vs. MCO: 2.24 )
MCO' s 10-Year Current Ratio Range
Min: 0.46   Max: 2.6
Current: 2.24

0.46
2.6
Quick Ratio 2.24
MCO's Quick Ratio is ranked higher than
83% of the 1012 Companies
in the Global Business Services industry.

( Industry Median: 1.33 vs. MCO: 2.24 )
MCO' s 10-Year Quick Ratio Range
Min: 0.46   Max: 2.6
Current: 2.24

0.46
2.6
Days Sales Outstanding 86.74
MCO's Days Sales Outstanding is ranked higher than
64% of the 1279 Companies
in the Global Business Services industry.

( Industry Median: 79.84 vs. MCO: 86.74 )
MCO' s 10-Year Days Sales Outstanding Range
Min: 54.6   Max: 316.21
Current: 86.74

54.6
316.21

Dividend & Buy Back

vs
industry
vs
history
Dividend Yield 1.10
MCO's Dividend Yield is ranked lower than
78% of the 697 Companies
in the Global Business Services industry.

( Industry Median: 2.13 vs. MCO: 1.10 )
MCO' s 10-Year Dividend Yield Range
Min: 0.26   Max: 2.49
Current: 1.1

0.26
2.49
Dividend Payout 0.24
MCO's Dividend Payout is ranked higher than
92% of the 1279 Companies
in the Global Business Services industry.

( Industry Median: 0.00 vs. MCO: 0.24 )
MCO' s 10-Year Dividend Payout Range
Min: 0.08   Max: 0.78
Current: 0.24

0.08
0.78
Dividend growth (3y) 27.90
MCO's Dividend growth (3y) is ranked higher than
89% of the 403 Companies
in the Global Business Services industry.

( Industry Median: 7.90 vs. MCO: 27.90 )
MCO' s 10-Year Dividend growth (3y) Range
Min: -39.4   Max: 46
Current: 27.9

-39.4
46
Yield on cost (5-Year) 3.26
MCO's Yield on cost (5-Year) is ranked higher than
62% of the 711 Companies
in the Global Business Services industry.

( Industry Median: 2.50 vs. MCO: 3.26 )
MCO' s 10-Year Yield on cost (5-Year) Range
Min: 0.77   Max: 7.39
Current: 3.26

0.77
7.39
Share Buyback Rate 2.20
MCO's Share Buyback Rate is ranked higher than
92% of the 682 Companies
in the Global Business Services industry.

( Industry Median: -1.00 vs. MCO: 2.20 )
MCO' s 10-Year Share Buyback Rate Range
Min: 7.1   Max: 1
Current: 2.2

Valuation & Return

vs
industry
vs
history
Price/DCF (Projected) 2.00
MCO's Price/DCF (Projected) is ranked higher than
76% of the 1279 Companies
in the Global Business Services industry.

( Industry Median: 0.00 vs. MCO: 2.00 )
MCO' s 10-Year Price/DCF (Projected) Range
Min: 0.62   Max: 4.1
Current: 2

0.62
4.1
Price/Median PS Value 1.40
MCO's Price/Median PS Value is ranked higher than
64% of the 1279 Companies
in the Global Business Services industry.

( Industry Median: 1.40 vs. MCO: 1.40 )
MCO' s 10-Year Price/Median PS Value Range
Min: 0.57   Max: 2.19
Current: 1.4

0.57
2.19
Price/Peter Lynch Fair Value 1.10
MCO's Price/Peter Lynch Fair Value is ranked higher than
94% of the 1279 Companies
in the Global Business Services industry.

( Industry Median: 0.00 vs. MCO: 1.10 )
MCO' s 10-Year Price/Peter Lynch Fair Value Range
Min: 0.61   Max: 2.26
Current: 1.1

0.61
2.26
Earnings Yield (Greenblatt) 6.60
MCO's Earnings Yield (Greenblatt) is ranked higher than
70% of the 1035 Companies
in the Global Business Services industry.

( Industry Median: 5.30 vs. MCO: 6.60 )
MCO' s 10-Year Earnings Yield (Greenblatt) Range
Min: 4.6   Max: 15.8
Current: 6.6

4.6
15.8
Forward Rate of Return (Yacktman) 23.20
MCO's Forward Rate of Return (Yacktman) is ranked higher than
86% of the 584 Companies
in the Global Business Services industry.

( Industry Median: 11.65 vs. MCO: 23.20 )
MCO' s 10-Year Forward Rate of Return (Yacktman) Range
Min: 0.3   Max: 33.4
Current: 23.2

0.3
33.4

Business Description

Industry: Business Services » Business Services
Compare:PJC, SIEB, GHL, GS, SF » details
Traded in other countries:DUT.Germany,
Moody's Corporation was founded in 1909. The Company is a provider of credit ratings, credit and economic related research, data and analytical tools, software solutions and related risk management services, quantitative credit risk measures, financial services training and certification services and outsourced research and analytical services to institutional customers. The Company operates in two segments; MIS and MA. The MIS segment is comprised of all of the Company's ratings operations. The MIS segment consists of five lines of business, which includes CFG, SFG, FIG, PPIF and MIS Other. MIS publishes credit ratings of debt obligations and the entities that issue such obligations in the markets, including various corporate and governmental obligations, structured finance securities and commercial paper programs. The MA segment develops products and services that support financial analysis and risk management activities of institutional participants in financial markets. The MA segment consists of three lines of business, which includes RD&A, ERS and PS. Within its Research, Data and Analytics business, MA distributes research and data developed by MIS as part of its ratings process, including in-depth research on major debt issuers, industry studies, and commentary on topical credit related events, and also provides economic research and credit data and analytical tools including quantitative credit risk scores. Within its Enterprise Risk Solutions business, MA provides software solutions and related risk management services. The Company's geographical footprint includes US and International markets. The MIS segment competes with other CRAs and with investment banks and brokerage firms that offer credit opinions and research. The MA segment competes in the financial information industry against diversified competitors including Thomson Reuters, Bloomberg, S&P Capital IQ, Fitch Solutions, Dun & Bradstreet, IBM, Wolters Kluwer, Sungard, SAS, Fiserv, MSCI and Markit Group among others. MA's main competitors within RD&A includes S&P Capital IQ, CreditSights, Thomson Reuters, Intex, IHS Global Insight, BlackRock Solutions, FactSet and other providers of fixed income analytics, valuations, economic data and research. The Company and its subsidiaries are subject to U.S. federal income tax as well as income tax in various state, local and foreign jurisdictions.
» More Articles for MCO

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