The 10-second takeaway
For the quarter ended March 31 (Q1), Moody's beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue increased. Non-GAAP earnings per share grew significantly. GAAP earnings per share expanded.
Gross margins expanded, operating margins contracted, net margins dropped.
Moody's logged revenue of $731.8 million. The seven analysts polled by S&P Capital IQ anticipated revenue of $717.3 million on the same basis. GAAP reported sales were 13% higher than the prior-year quarter's $646.8 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.97. The nine earnings estimates compiled by S&P Capital IQ forecast $0.85 per share. Non-GAAP EPS of $0.97 for Q1 were 28% higher than the prior-year quarter's $0.76 per share. GAAP EPS of $0.83 for Q1 were 9.2% higher than the prior-year quarter's $0.76 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 72.6%, 130 basis points better than the prior-year quarter. Operating margin was 38.3%, 330 basis points worse than the prior-year quarter. Net margin was 25.7%, 110 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $713.3 million. On the bottom line, the average EPS estimate is $0.87.
Next year's average estimate for revenue is $2.93 billion. The average EPS estimate is $3.44.
The stock has a two-star rating (out of five) at Motley Fool CAPS, with 850 members out of 1,001 rating the stock outperform, and 151 members rating it underperform. Among 358 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 313 give Moody's a green thumbs-up, and 45 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 $51.50.
- Add Moody's to My Watchlist.