Moody's Corporation
Orin's own judgment of how firmly the evidence points one way — not the chance the price goes up.
Moody's remains a high-quality compounder with FY2025 operating margin of 44.8% and Q2 2026 revenue growth accelerating to 15.1% YoY, but the Q3 2026 earnings slight miss (actual EPS $4.14 versus $4.25 estimate) breaks an otherwise strong beat streak and tempers near-term enthusiasm.
The valuation premium persists at 30.07x trailing PE versus a peer median of 27.97x and EV/EBITDA 28.8% above the peer median, while insiders have been net sellers of 39,465 shares over 24 months with zero open-market acquisitions. Technicals have improved from the prior assessment — the stock closed at $475.35 on 20 Oct, above its 200-day MA of $468.73 with a neutral RSI of 53.82 — but the combination of a fresh earnings miss and elevated valuation argues for patience until the growth trajectory re-accelerates or the multiple compresses.
What could go wrong
- Valuation compression. At 30.07x PE and 22.10x EV/EBITDA — 7.5% and 28.8% above peer medians respectively — any deceleration in growth could trigger a derating toward the peer median of 27.97x PE.
- Earnings momentum stalling. Q3 2026 EPS came in at $4.14 versus $4.25 estimated (-2.6% surprise), breaking a streak of consecutive beats; a second consecutive miss would signal sustained deceleration.
- Insider selling pressure. Insiders net sold 39,465 shares worth $19.0M over 24 months with zero open-market acquisitions; continued selling by the CEO and other officers signals limited insider conviction at current levels.
- Debt issuance cyclicality. Moody's Investors Service revenue is tied to debt issuance volumes; a slowdown in corporate or structured finance issuance could pressure the ratings segment despite Analytics resilience.
What would change my mind
Where this comes from: FY25 fundamentals · Q2 2026 results · earnings vs estimates, 21 Oct · peer comparison. Orin's read on MCO; not advice.
How has the share price moved?
Down 4.3% over twelve months, from $495.08 on 27 Oct 2025 to $474.00 at the Tue 27 Oct 2026 close. Its highest close in that time was $539.61 on 15 Jan 2026; the last close is 12.2% below it.
- Green line: the closing price each trading day.
- Grey line: the average closing price over the last 50 trading days.
- Dashed amber line: the same over the last 200 trading days — a slower, smoother line.
- Bars along the bottom: shares traded each day — green when it closed higher than the day before, rose when lower (the most, 3.9M, on 10 Feb 2026).
- Flags: the company's filings, on the day they were made (a 10-Q is the quarterly report and a 10-K the annual report; an 8-K reports a major event).
On file
All MCO filings| Form | Filed | What it says | Read |
|---|---|---|---|
| 10-Q | 21 Oct | — | on file |
| 8-K | 21 Oct | Moody's Corporation reported third-quarter 2026 revenue of $2.023 billion, a 1% increase year-over-year. | read |
| 8-K/A | 15 Oct | — | on file |
| 8-K | 12 Aug | Keith Demmings was elected to Moody's Corporation Board of Directors, effective November 1, 2026. | read |
| 10-Q | 23 Jul | Moody's Corporation reported revenue of $2.185 billion for the three months ended June 30, 2026, an increase of 15% year-over-year. | read |
| 8-K | 22 Jul | Moody's Corporation announced its financial results for the quarter ended June 30, 2026, and its 2026 outlook on July 22, 2026. | read |
| 13G/A | 15 May | — | on file |
| 13G | 30 Apr | — | on file |
Largest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| Berkshire Hathaway | $11.2B | 3.7% |
| BlackRock | $5.6B | 0.1% |
| Vanguard Capital Management | $4.4B | 0.1% |
| State Street | $3.2B | 0.1% |
| FMR | $2.3B | 0.1% |
| Geode Capital Management | $1.8B | 0.1% |
| Vanguard Portfolio Management | $1.7B | 0.1% |
| Morgan Stanley | $1.1B | 0.1% |
| Norges Bank | $1.1B | 0.1% |
| Goldman Sachs Group | $963.1M | 0.1% |
124 of the 815 filers we track · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 313 Form 4 filings; open-market trades net −$19.0M. Of the 50 on hand, 0 were open-market purchases and 6 sales — the rest are grants, option exercises and tax withholding.
Ask Orin about MCO
Orin answers questions about MCO from its filings, transcripts and numbers — with the source behind every claim. Your own desk starts with 3 free days, card required.
Start 3 free days →How is it priced, against its own past and its sector?
Priced at 28.8× its last 12 months of profit (Tue 27 Oct close) — lower than in all 5 of its last 5 fiscal years (middle 37.3×); the typical Financial Services company on the NYSE is at 17.6×.
| Measure | Now | Its usual | Sector |
|---|---|---|---|
| P/E | 28.8×below usual | 37.3× | 17.6× |
| P/S | 10.00×below usual | 11.9× | — |
| EV/EBITDA | 22.8×below usual | 24.9× | — |
| P/B | 25.1×above usual | 22.6× | — |
- "Its usual" is the middle of its own last 5 fiscal years.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
P/S: the company's total market value divided by one year of revenue. Used when there is no profit to measure.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
P/B: the share price divided by the book value per share — what the company owns minus what it owes, as its accounts record it. When book value is tiny, P/B swings wildly and says little.
What do the analysts who cover it publish?
The analysts' average 12-month price target is $536 (from $480 to $595) — 13% above the Tue 27 Oct close price. That is their published opinion, not Orin's.
$536
$480 – $595 · +13% against the last close
- 12 buy or overweight
- 5 hold
- 0 underweight or sell
Price target: the share price an analyst publishes for about 12 months ahead. It is the opinion of the firm that wrote it; the average is across the firms that cover the company.
Overweight / underweight: analysts' rating words: overweight means the firm expects the stock to do better than the others it covers, underweight worse. Their words, not Orin's.
How is it priced next to the companies it is compared to?
Priced at 28.8× its last 12 months of profit; the middle P/E of the 4 companies it is compared to that made a profit is 29.7×.
| Company | Market value | P/E | EV/EBITDA | Gross margin | Net margin | ROE |
|---|---|---|---|---|---|---|
| MCOMoody's Corporation | $82B | 28.8× | 22.8× | 73.1% | 35.3% | 86% |
| FDSFactSet Research Systems Inc. | $11B | 21.2× | 13.5× | 50.6% | 21.5% | 26% |
| MSCIMSCI Inc. | $44B | 32.0× | 23.8× | 82.9% | 40.3% | n/m |
| SPGIS&P Global Inc. | $132B | 27.3× | 17.4× | 70.9% | 30.5% | 17% |
| VRSKVerisk Analytics, Inc. | $28B | 32.0× | 16.3× | 67.7% | 27.7% | n/m |
- MSCI, VRSK: return on equity is not meaningful (n/m) — book value is below zero.
- The list of companies is the data vendor's choice, so it can include a company a person would not have picked.
Market value: the share price times the number of shares — what the whole company is priced at.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
Gross margin: the share of each $1 of sales left after the direct cost of making what was sold.
Net margin: the share of each $1 of sales kept as profit after every cost. Below zero, the company lost money.
ROE: return on equity: one year of profit as a share of the shareholders' money in the business (its book value).
Is it priced high or low compared with its own past?
Priced at 28.8× its last 12 months of profit (Tue 27 Oct close). It has no full fiscal year on file since its history starts, so there is nothing of its own to compare with.
- Now28.8×
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
Fiscal year (FY): the company's own 12-month accounting year, which need not match the calendar year.
How has its sector been priced?
Financial Services companies on the NYSE were priced at a typical 17.6× their yearly profit (Tue 27 Oct close).
- Now17.6×
- Each year is the middle of that calendar year's daily sector P/E; "Now" is the Tue 27 Oct close figure, the same one in the table above.
Sector P/E: the middle P/E of the companies in the same sector on the same stock exchange, as the data vendor works it out each day.
What does a cash-flow model say a share is worth?
A standard cash-flow model puts it at $170 a share — 64% below the $472.89 price it was computed against (27 Oct).
| Model | Value a share | Against the price then |
|---|---|---|
| Standard | $170 | 64% below $472.89 |
| Levered | $157 | 67% below $472.89 |
Discounted cash flow: a model's estimate of what the company is worth today, from the cash it is forecast to make in future years. Small changes in the forecast move it a lot, and it says little about a company that loses money.
Standard / levered: two versions of the cash-flow model: the standard one counts the cash before the company pays its lenders, the levered one after.