Moody's Corporation provides credit ratings and research covering debt instruments and securities, and Moody's Analytics, which offers leading-edge software, advisory services and research for credit and economic analysis and financial risk management. The company was founded in 1900 and is based in New York, New York.
MCO Price Forecast Based on DCF Valuation
DCF Fair Value Target:
We started the process of determining a valid price forecast for Moodys Corp with a discounted cash flow analysis -- the results of which can be found in the table below. To summarize, we found that Moodys Corp ranked in the 28th percentile in terms of potential gain offered. Our DCF analysis suggests the stock is overvalued by about 37.67%. In terms of the factors that were most noteworthy in this DCF analysis for MCO, they are:
The company has produced more trailing twelve month cash flow than 80.19% of its sector Financial Services.
The business' balance sheet reveals debt to be 13% of the company's capital (with equity being the remaining amount). Approximately only 24.29% of US stocks with free cash flow have a lower reliance on debt in their capital structure.
MCO's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than 43.26% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Financial Services that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as MCO, try ASPS, WLTW, MMC, L, and EIG.