Head-To-Head Survey: Moody’s (MCO) vs. Its Competitors

Moody’s (NYSE:MCO) is one of 1,744 publicly-traded companies in the “Capital Markets” industry, but how does it weigh in compared to its rivals? We will compare Moody’s to related businesses based on the strength of its earnings, profitability, valuation, analyst recommendations, dividends, institutional ownership and risk.

Profitability

This table compares Moody’s and its rivals’ net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Moody’s	35.26%	84.76%	19.65%
Moody’s Competitors	318.48%	79.19%	3.72%

Analyst Recommendations

This is a summary of current ratings and target prices for Moody’s and its rivals, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Moody’s	0	7	13	0	2.65
Moody’s Competitors	5556	20130	22469	642	2.37

Moody’s currently has a consensus target price of $552.63, suggesting a potential upside of 8.85%. As a group, “Capital Markets” companies have a potential upside of 26.38%. Given Moody’s’ rivals higher possible upside, analysts plainly believe Moody’s has less favorable growth aspects than its rivals.

Dividends

Moody’s pays an annual dividend of $4.12 per share and has a dividend yield of 0.8%. Moody’s pays out 25.1% of its earnings in the form of a dividend. As a group, “Capital Markets” companies pay a dividend yield of 3.2% and pay out 30.0% of their earnings in the form of a dividend. Moody’s has increased its dividend for 16 consecutive years.

Risk and Volatility

Moody’s has a beta of 1.3, suggesting that its share price is 30% more volatile than the S&P 500. Comparatively, Moody’s’ rivals have a beta of 0.79, suggesting that their average share price is 21% less volatile than the S&P 500.

Earnings & Valuation

This table compares Moody’s and its rivals revenue, earnings per share and valuation.

	Gross Revenue	Net Income	Price/Earnings Ratio
Moody’s	$8.18 billion	$2.46 billion	30.94
Moody’s Competitors	$2.44 billion	$397.86 million	17.66

Moody’s has higher revenue and earnings than its rivals. Moody’s is trading at a higher price-to-earnings ratio than its rivals, indicating that it is currently more expensive than other companies in its industry.

Institutional & Insider Ownership

92.1% of Moody’s shares are owned by institutional investors. Comparatively, 30.5% of shares of all “Capital Markets” companies are owned by institutional investors. 0.1% of Moody’s shares are owned by insiders. Comparatively, 13.1% of shares of all “Capital Markets” companies are owned by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a stock is poised for long-term growth.

Summary

Moody’s beats its rivals on 10 of the 15 factors compared.

Moody’s Company Profile

Moody’s Corporation operates as an integrated risk assessment firm worldwide. It operates in two segments, Moody’s Analytics and Moody’s Investors Services. The Moody’s Analytics segment develops a range of products and services that support the risk management activities of institutional participants in financial markets. It also offers credit research, credit models and analytics, economics data and models, and structured finance solutions; data sets on companies and securities; and SaaS solutions supporting banking, insurance, and know your customer workflows. The Moody’s Investors Service segment publishes credit ratings and provides assessment services on various debt obligations, programs and facilities, and entities that issue such obligations, such as various corporate, financial institution, and governmental obligations, as well as structured finance securities. The company was formerly known as Dun and Bradstreet Company and changed its name to Moody’s Corporation in September 2000. Moody’s Corporation was founded in 1900 and is headquartered in New York, New York.