Moody's Corporation $ 284.53 -4.53 (-1.57%)
Moody's Corporation News and Headlines -
Greetings from Middleburg. "May no new thing arise" is an old Spanish benediction spoken between friends at parting. With so much of normal life on hold, it seems the begrudging best one can hope for under COVID is, indeed, that no new thing arise. That remains the case at Akre Capital where (knock on wood) our employees remain healthy and productive. We hope the same applies to you.
The Akre Focus Fund's third quarter 2020 performance for the Institutional share class was 5.58% compared with S&P 500 Total Return at 8.93%. Year-to-date performance through September 30 for the Institutional share
Like many value investors, Mohnish Pabrai (Trades, Portfolio) started his career by finding cheap businesses that were trading at below intrinsic value. However, like so many other value investors in the 21st century, he has adapted his investment philosophy over time to try and identify really great businesses that can compound shareholder wealth and yield 10, or even 100, times what they invested. When addressing students at Peking University back in 2016, Pabrai explained how he goes about finding "multi-baggers."
An accidental 60-bagger stock
In the mid-1990s, Pabrai had been investing in Indian publicly traded
In response to my recent discussion of Moody's Corp. (MCO), reader Kenny asked how it would measure up against the other major ratings company, S&P Global Inc. (SPGI). He also wondered if S&P Global's moat would be wider than that of Moody's.
Both companies are bond rating agencies, which means they assess corporate and some government bond issuances, helping investors distinguish the levels of quality. That's done with letter grades, not unlike school report cards.
The issuers normally pay an agency to do the rating because rated bonds sell more easily than unrated bonds. Since the agencies essentially hold an
How would you rate Moody's Corp. (MCO), the company that rates the debt of other companies?
Fortunately, GuruFocus provides us with a long list of metrics and calculators that allow us to assess its worth as a stock--but not its debt.
And debt evaluation is the meat and potatoes of Moody's business. It described its traditional operations in its 10-K for 2019 this way: "MIS publishes credit ratings and provides assessment services on a wide range of debt obligations and the entities that issue such obligations in markets worldwide, including various corporate and governmental obligations, structured finance securities and commercial
In February 2020, during an appearance on CNBC, Warren Buffett (Trades, Portfolio) (BRK.A)(BRK.B) discussed his investment in banks, most notably Bank of America (BAC) and Wells Fargo (WFC). For some background, Buffett had increased his investment in Bank of America over the past few years (starting with the 700 million shares acquired via warrants in 2017); on the other hand, he has been paring back his stake in Wells Fargo.
When asked about his activity in Wells Fargo, Buffett said the following:
“It’s absolutely true that we’ve sold down our position. Some of
Greetings from Middleburg. We hope this update finds you and your families well. While there is no distinct timeline for a return to normal life, we are pleased to report that the business continuity plans we implemented in March in response to COVID-19 continue to work well, and there has been virtually no discernable impact on our operations.
The Akre Focus Fund’s second quarter 2020 performance for the Institutional share class was 21.66% compared with S&P 500 Total Return at 20.54%. Year-to-date performance for the Institutional share class was 8.11% compared with the S&P 500 Total Return at -3.08%.
The airline industry has struggled to grapple with the disruptions wrought by the outbreak of the pandemic. With air travel brought to a near halt by government restrictions before being resumed at a snail's pace as consumers limit travel, it has been all but impossible to fill up planes, even on traditionally high-demand routes.
With lockdowns being lifted around the world and economic activity revving back up at last, many people are again hoping for a V-shaped recovery. Those hopes have helped buoy airline stocks up from their mid-May lows. Yet, while many industries will undoubtedly see a
When I first stumbled across Greenberg, his approach to investing made a lot of sense to me. It was based around the traditional style of value investing, but rather than concentrate on asset values, Greenberg liked to focus on cash flows. This style of investing is widely known and understood today, but when the value investor set up his first firm in 1984 with John Shapiro, it was still a
With its conventional monetary policy toolkit largely exhausted at the outset of the economic downturn, the Federal Reserve quickly turned to more idiosyncratic alternatives.
The central bank has begun facilitating the purchase of corporate bonds. The Fed is now in waters that have so far been uncharted by the U.S., and its interventions are coming under increasing scrutiny – especially as it plunges deeper into high-yield debt.
A stretched mandate
The Fed’s entry into corporate bond purchases, especially risky junk bonds, is unprecedented. On April 14, legendary bond investor Jeffrey Gundlach criticized the Fed for
As you know, the COVID-19 pandemic has resulted in a significant market disruption over recent weeks. As the world navigates the uncertainty caused by the virus, we want to let you know that Akre Capital is fully committed to our clients, employees, and partners, and we are taking the necessary steps to ensure the highest level of business continuity during this time.
On March 15, 2020, we implemented a Work-From-Home program. We will continue to monitor COVID-19 and market volatility closely and implement additional operational changes as conditions require or permit. Our team is very well-equipped to work outside of
Hi fellow investors,
In my previous videos, I mentioned that the Shiller P/E can be used for mirroring the overall market valuation. It can also be used to mirror the sector valuation. The Shiller P/E is a better mirror of valuation lots of times and it can also be used for individual stocks.
Once we go to GuruFocus.com, I will look at Moody’s (MCO). On the main page for Moody’s, you will see the rank for financial strength. It will have the rank for profitability and it will also have the
Investors may want to have a look at stocks that have beaten the S&P 500 index (the benchmark for the U.S. market) in terms of a higher earnings per share (EPS) growth rate over the past few years, as these stocks are more likely to represent high-quality companies.
The S&P 500 has grown its EPS by about 6.5% every year over the past five years, resulting in an almost 20% jump in its value (which was around 2,447.33 at close on Tuesday, March. 24).
Past performance is not a guarantee for future results. However, it can be a helpful tool
In the first couple of months of 2020, the U.S. economy has continued to see a corporate credit situation that would have been impossible to imagine a few decades ago. To stave off the next economic recession for as long as possible after the 2008 financial crisis, the Federal Reserve has fought fire with fire, cutting base interest rates in order to make debt cheaper for the increasing number of financially struggling corporate giants.
Increasing junk debt
After some companies saw their credit ratings increase at the end of 2019, the market as a whole is continuing on its decade-long
I’ve spent a lot of time lately thinking about valuing great businesses. It’s something I’ve personally struggled with as of late, most notably as Microsoft (MSFT) – a long held position in my portfolio - has seen its valuation continue to march higher. To be frank, its price appreciation has been somewhat uncomfortable for me. The fact that it’s a large position in my portfolio surely doesn’t help in that regard. I’m doing what I can to keep myself honest to ensure that my past success with the stock and my admiration for the business and its leadership (both which
The bull market celebrated its tenth year with a flourish as 2019 marked the best year for the S&P 500 since 2013. Our 2019 fourth quarter performance for the Institutional share class was +3.45% compared with S&P 500 Total Return at +9.07%. For the year ending December 31, 2019, performance for the Institutional share class was +35.35%, compared with +31.49% for the S&P 500 Total Return.
We have discussed our cash weighting with you over the course of 2019, and our reasoning has not changed in these early days of 2020: valuations in general remain unconducive to generating above-average long-term
A recent post from Akre Capital Management, “The Art of (Not) Selling”, has been making the rounds. I’m a big fan of Akre – they are damn good investors - and think there are some interesting points in the article. Notably, I think they make some proclamations that even investors who aspire to be like them (myself included) scoff at on first glance. I wanted to discuss a few of those points here.
First, it’s important to understand the kind of investors you’re dealing with at Akre. As noted in the post, they are focused on making long-term, concentrated bets
After 21 years in the securities business, the then 67-year-old Chuck Akre (Trades, Portfolio) launched the Akre Focus Fund in August of 2009. Since then, Akre Capital Management has grown to manage $13.6 billion in private fund, mutual fund and separately managed accounts as of Nov. 30, 2019, $12.3 billion of which are part of the Akre Focus Fund.
The fund has gained renown for consistently placing in the top third of mutual funds in the U.S. in terms of returns, beating the S&P 500 in nearly all measured periods. Below is a chart of the quarter-end
Peter Lynch’s "One Up On Wall Street" is a classic of the investment genre. In the book, the legendary manager of the Fidelity Magellan Fund presented a taxonomy of stocks that has informed many investors’ thinking.
In their second-quarter 2019 investor letter, published in July, the team at Mar Vista Investment Partners decided to do something similar:
“To understand better what he owned and why, Mr. Lynch classified stocks into six categories: slow growers, stalwarts, fast growers, cyclicals, asset plays, and turnarounds. Each group represented differing levels of expected returns and risk and
While no recession or financial crisis starts in exactly the same way, or follows the exact same pattern when it does kick off, there is always a catalyst that triggers the cascade failure. As 2019 grinds to a close, there are numerous potential triggers to consider.
However, perhaps the most concerning is the increasing risk of a corporate debt meltdown. Indeed, as I discussed in a previous article for GuruFocus, legendary bond investor Jeffrey Gundlach thinks increasing amounts of corporate debt, combined with laxer lending standards, will likely prove to be this economic expansion’s downfall.
According to theÂ GuruFocus list of 52-week highs, these Guru stocks have reached their 52-Week Highs.
Allergan PLC reached the 52-week high of $190.30
Allergan PLC (AGN) is s specialty pharmaceutical manufacturer. It specializes in aesthetics, ophthalmology, women's health, gastrointestinal and central nervous system products. In 2016, Allergan sold its generics and distribution segments to Teva.
The price of Allergan PLC shares has reached $190.30, which is 1% off the 52-week high of $192.26. The company has a market cap of $62.47 billion; its shares were traded around $190.30 with and a price-sales ratio