Moody's Corporation

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MCO : NYSE : Services
$102.90 up 0.06 | 0.06%
Today's Range: 102.54 - 103.58
Avg. Daily Volume: 863,800
10/25/16 - 3:31 PM ET

Financial Analysis

MOODY'S CORP's gross profit margin for the third quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. Sales and net income have grown, and although the growth in revenues has outpaced the average competitor within the industry, the net income growth has not. MOODY'S CORP is extremely liquid. Currently, the Quick Ratio is 2.06 which clearly shows the ability to cover any short-term cash needs. The company's liquidity has decreased from the same period last year.

During the same period, stockholders' equity ("net worth") has decreased by 20.13% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is very unlikely to face financial difficulties in the near future.

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Income Statement Q3 FY16 Q3 FY15
Net Sales ($mil)917.1834.9
EBITDA ($mil)438.6378.0
EBIT ($mil)405.9349.7
Net Income ($mil)255.3231.6

Balance Sheet Q3 FY16 Q3 FY15
Cash & Equiv. ($mil)2057.91941.3
Total Assets ($mil)5019.34772.9
Total Debt ($mil)3418.13124.5
Equity ($mil)-564.5-469.9

Profitability Q3 FY16 Q3 FY15
Gross Profit Margin72.3971.72
EBITDA Margin47.8245.27
Operating Margin44.2641.89
Sales Turnover0.70.73
Return on Assets18.1920.1
Return on Equity0.00.0
Debt Q3 FY16 Q3 FY15
Current Ratio2.152.73
Interest Expense35.629.8
Interest Coverage11.411.73

Share Data Q3 FY16 Q3 FY15
Shares outstanding (mil)191.17197.74
Div / share0.370.34
Book value / share-2.95-2.38
Institutional Own % n/a n/a
Avg Daily Volume873717.01194658.0


BUY. This stock's P/E ratio indicates a premium compared to an average of 20.68 for the Capital Markets industry and a discount compared to the S&P 500 average of 24.75. Normally, for additional comaprison, we would look at the price-to-book ratio; however, this company's price-to-book ratio is negative making the value useless for comparisons. The price-to-sales ratio is well above both the S&P 500 average and the industry average, indicating a premium. Upon assessment of these and other key valuation criteria, MOODY'S CORP seems to be trading at a premium to investment alternatives within the industry.

1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
MCO 22.21 Peers 20.68   MCO 17.59 Peers 16.45

Average. An average P/E ratio can signify an industry neutral price for a stock and an average growth expectation.

MCO is trading at a valuation on par with its peers.


Average. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

MCO is trading at a valuation on par to its peers.

1 2 3 4 5
premium   discount
  Price to
1 2 3 4 5
premium   discount
MCO 20.13 Peers 19.35   MCO 14.71 Peers 2.75

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

MCO is trading at a premium to its peers.


Premium. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

MCO trades at a significant premium to its peers.

1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
MCO NM Peers 5.90   MCO -0.44 Peers 10.76

Neutral. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

MCO's P/B is negative making this valuation measure meaningless.


Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, MCO is expected to significantly trail its peers on the basis of its earnings growth rate.

1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
MCO 5.57 Peers 4.31   MCO 0.91 Peers 0.10

Premium. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

MCO is trading at a significant premium to its industry.


Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

MCO has a sales growth rate that significantly exceeds its peers.



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