Debt exceeds twice its equity, so financial risk warrants a closer look.
Metrics · D/E ~238% · Current Ratio 1.19
💲Is the price expensive now?
Not cheap (fair to slightly pricey)
Because it is a good, popular company, those expectations are already priced in.
Metrics · P/E 30.0 · P/B 27.2
💡Operating margin 46.2% tops rival SPGI (42.5%). But ROE 76.9% mostly reflects buybacks shrinking equity to $3.0B, and P/B 27.2x has the same cause.
Compiled from public financial data. Not a recommendation to buy or sell any security. · Source: stockanalysis (margins, P/B, ROE are TTM; equity cross-checked against SEC EDGAR), as of 2026-07-23
Business Summary · Key Value Metrics
Together with S&P Global, Moody's forms the global credit-ratings duopoly. It runs two segments: MIS, which rates debt issuers, and MA, which sells risk-analytics software and data. Recurring revenue is 99% of MA's total (ARR about $3.7B). TTM revenue $8.16B, operating margin 46.2%, net margin 34.3%.
Current Price
$472.24
-3.57%-$17.46· Close 2026-07-23
Analyst Consensus Target (external reference)
$555.29
Avg. of 24 external analysts · stockanalysis (24-analyst consensus, Buy · high $610 / low $500)
P/E (TTM)
30.0x
TTM
ROE
76.9%
TTM · buybacks shrank equity
Operating margin
46.2%
TTM · above SPGI (42.5%)
P/B
27.2x
equity only $3.0B
Dividend yield
0.87%
quarterly dividend
Market cap
$82.5B
as of 2026-07-23
Economic Moat · Key Business Segments
Moody's and S&P Global split the ratings market as a duopoly. Issuers effectively need a rating to raise debt, so revenue tracks issuance: Q2 2026 issuance topped $2 trillion and MIS revenue reached $1.26B (+25% YoY) at a 68.3% adjusted operating margin. On the other side, MA draws 99% of its revenue from recurring contracts with ARR near $3.7B (+9% YoY), cushioning the business when issuance freezes (Source: company IR, stockanalysis).
Duopoly structure
Moody's and S&P Global divide the market; a century of rating history is the barrier.
Regulation as moat
Institutional mandates and capital rules require recognized ratings, fixing demand in place.
Recurring revenue at MA
99% of analytics revenue is subscription-based, ARR about $3.7B, damping the cycle.
Asset-light economics
No factories or inventory, so operating margin runs 46% and most cash returns to holders.
10-Year Financial Trends
Revenue compounded at a 9-year CAGR of +8.8% ($3.6B in 2016 to $7.7B in 2025). Net income +28.0% and EPS +29.2% look explosive, but that is base-year distortion: in Q4 2016 Moody's booked a ~$864M settlement with the U.S. DOJ and 21 states over RMBS ratings ($702M after tax, $3.62 a share), pushing 2016 EPS to $1.36. Reversing it implies ~$4.98: EPS CAGR +11.9%, net income +10.9%. In 2022 a rate spike froze issuance, cutting revenue 12% and margin to 34.4%; 2025 margin was 43.4%. Q2 2026 (July 22): revenue $2.19B (+15% YoY), diluted EPS $5.03 (Source: SEC EDGAR, U.S. DOJ, stockanalysis).
9-Year CAGR: Revenue +8.8% · Operating Income +20.0% (+9.2% ex-2016 settlement) · Net Income +28.0% (+10.9% ex-settlement) · EPS +29.2% (+11.9% ex-settlement)
Source: SEC EDGAR 10-K (revenue, operating income, net income, diluted EPS, total assets, equity); fiscal year-end closes from Yahoo Finance; cross-checked against stockanalysis. P/E is year-end close ÷ diluted EPS and matches stockanalysis for all five overlapping years (2021-2025). Because equity was negative from 2015 to 2017 under accumulated buybacks, ROA replaces the ROE series.
Mega-Cap Value Metric Comparison
Moody's 46.2% operating margin beats rival S&P Global's 42.5%, though its $8.2B of revenue is about half SPGI's $15.7B. The gaps in ROE (76.9% vs 13.9%) and P/B (27.2x vs 4.0x) reflect capital structure rather than business quality — years of buybacks cut Moody's equity to $3.0B, and the small denominator inflates both ratios at once (Source: stockanalysis, company IR).
Dependence on the issuance cycle— MIS revenue tracks debt issuance directly. When the 2022 rate spike froze issuance, revenue fell 12% and operating margin dropped to 34.4%. The same shock can recur.Source: company 10-K
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Shrinking equity and P/B— Buybacks cut equity from $4.05B at end-2025 to $2.99B by March 2026 in a single quarter. ROE 76.9% and P/B 27.2x embed that shrinkage, so peer comparisons need care.Source: SEC EDGAR 10-Q
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Regulatory and litigation history— Moody's paid roughly $864M in 2016 to settle DOJ and state claims over RMBS ratings. Ratings agencies face standing regulatory and litigation exposure.Source: U.S. DOJ press release
✦ ValueCrab Dashboard PreviewMCO $472.24 -3.57% · as of 2026-07-23
Q. What are the key value metrics for Moody's (MCO)?P/E (TTM) 30.0, ROE 76.9%, operating margin 46.2%, P/B 27.2, dividend yield 0.87%, and a 9-year revenue CAGR of +8.8% (Source: stockanalysis, SEC EDGAR, as of 2026-07-23).
Q. Doesn't a 76.9% ROE mean this is an outstanding business?Not on the number alone. ROE is net income divided by equity, and years of buybacks cut Moody's equity to $3.0B, shrinking the denominator. S&P Global, in the same business, posts a 13.9% ROE. Operating margin distorts less: 46.2% for MCO versus 42.5% for SPGI.
Q. Why were 2016 results so weak?Moody's settled with the U.S. Department of Justice and 21 states for about $864M over allegations it inflated pre-crisis RMBS ratings, booking $702M after tax ($3.62 per share) in Q4 2016. That pushed EPS down to $1.36; reversing it implies roughly $4.98.
Q. How does Moody's differ from S&P Global?Both are ratings duopolists. SPGI's $15.7B of revenue is about double Moody's $8.2B because it also owns index businesses (the S&P 500 among them) and commodity information. Moody's is more concentrated in ratings and risk analytics, and carries the higher operating margin at 46.2% versus 42.5%.