Moody's
The 10-second takeaway
For the quarter ended Sep. 30 (Q3), Moody's beat expectations on revenues and crushed expectations on earnings per share.
Compared to the prior-year quarter, revenue grew significantly and GAAP earnings per share expanded significantly.
Margins grew across the board.
Revenue details
Moody's tallied revenue of $688.5 million. The seven analysts polled by S&P Capital IQ expected to see a top line of $624.4 million on the same basis. GAAP reported sales were 30% higher than the prior-year quarter's $531.3 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS details
EPS came in at $0.75. The nine earnings estimates compiled by S&P Capital IQ predicted $0.62 per share. GAAP EPS of $0.81 for Q3 were 42% higher than the prior-year quarter's $0.57 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
Margin details
For the quarter, gross margin was 69.9%, 210 basis points better than the prior-year quarter. Operating margin was 39.2%, 230 basis points better than the prior-year quarter. Net margin was 26.7%, 210 basis points better than the prior-year quarter.
Looking ahead
Next quarter's average estimate for revenue is $652.2 million. On the bottom line, the average EPS estimate is $0.62.
Next year's average estimate for revenue is $2.57 billion. The average EPS estimate is $2.81.
Investor sentiment
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 860 members out of 1,015 rating the stock outperform, and 155 members rating it underperform. Among 354 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 300 give Moody's a green thumbs-up, and 54 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Moody's is hold, with an average price target of $43.75.
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