Buy Signal on Moody's (MCO-US)
Moody’s Corp is a $ 53.9 Bn market cap, and a provider of credit ratings; credit, capital markets and economic related research, data and analytical tools; software solutions and related risk management services, research and analytical services to financial institution customers.
The Company operates in two segments: Moody's Investors Service (MIS) and Moody's Analytics (MA). The MIS segment includes its ratings operations. The MA segment develops a range of products and services that support financial analysis and risk management activities of institutional participants in financial markets.
Moody’s should not suffer from a cyclical rise in rates, as it should not impact debt issuance and will ease price increase, especially as the credit rating industry is an oligopoly. The ESG looks also a huge opportunity, as it creates another layer of fees, while there has been a massive increase in green bonds and as Moody’s made 2 recent acquisitions to adress this market (427 and V.E). Therefore EPS growth is expected to accelerate from 2022 to low single digit to double digit.
Short term catalyst : ESG, EPS growth acceleration.
This signal looks consistent with the Major Bullish Trend in the US Financial Services sector.