Moody's Q4 Earnings Exceed Expectations
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Feb 18 2026
0mins
Should l Buy MCO?
Source: seekingalpha
- Earnings Beat: Moody's reported a Q4 non-GAAP EPS of $3.64, surpassing expectations by $0.20, indicating strong profitability and boosting investor confidence in the company's financial health.
- Significant Revenue Growth: The company achieved Q4 revenue of $1.89 billion, a 13.2% year-over-year increase that exceeded expectations by $20 million, reflecting robust market performance and sustained demand across its services.
- Segment Performance: Revenue growth was driven by a 12% increase in Decision Solutions, 6% in Research and Insights, and 8% in Data & Information, showcasing the company's success in diversifying its business and solidifying its market position.
- Positive Market Outlook: Moody's was upgraded to Buy by Stifel due to favorable debt issuance outlook, leading to a stock price increase, which indicates market optimism regarding its future growth potential and may attract more investor interest.
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Analyst Views on MCO
Wall Street analysts forecast MCO stock price to rise
10 Analyst Rating
8 Buy
2 Hold
0 Sell
Strong Buy
Current: 438.780
Low
526.00
Averages
586.50
High
660.00
Current: 438.780
Low
526.00
Averages
586.50
High
660.00
About MCO
Moody's Corporation is a global integrated risk assessment company. It is a global provider of research and insights; data and information, and decision solutions, which help companies make decisions. Its MA segment provides data, intelligence and analytical tools to help business and financial leaders make decisions. MA consists of a premier fixed income and economic research business (Research & Insights); a data business powered by databases on companies and credit (Data & Information), and three cloud-based subscription businesses serving banking, insurance and KYC workflows (Decision Solutions). Its MIS segment is a global provider of credit ratings, research, and risk analysis. It publishes credit ratings and provides assessment services on a wide range of debt obligations, programs and facilities, and the entities that issue such obligations in markets worldwide, including various corporate, financial institution and governmental obligations, and structured finance securities.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Historical Data Warning: History indicates that each time gasoline prices exceeded $4 per gallon, the S&P 500 experienced an average decline of 41%, suggesting that the current index, only 6% below its record high, could face a more significant downturn.
- Recession Risk Intensifies: Moody's chief economist warned that prolonged high oil prices could make a recession unavoidable, with the S&P 500 historically averaging a 32% decline during past recessions, indicating potential for deeper market corrections ahead.
- Investor Strategy: Amid increasing market uncertainty, investors should selectively buy reasonably priced stocks expected to see substantial earnings growth over the next five years, as the S&P 500 may continue to decline in the coming weeks, but history shows the market eventually recovers from past downturns.
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- Liquidity Management Pressures: He pointed out that redemption pressures have emerged in private credit markets, particularly in funds exposed to riskier borrowers like software companies, raising concerns about liquidity management in an asset class that expanded rapidly during low interest rates.
- Market Volatility Assessment: Despite recent market volatility, Buffett believes it does not approach the levels that historically created compelling investment opportunities for Berkshire, noting that there have been three instances since he took over where the market dropped more than 50%, indicating current conditions are not alarming.
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- Surge in Redemption Requests: Blue Owl Capital recently capped redemptions at 5% for two of its private credit funds after facing an unusually large wave of withdrawal requests, indicating that retail capital is reacting more swiftly than the typically stable institutional base.
- Investor Behavior Shift: In the $36 billion Blue Owl Credit Income Corp., investors sought to redeem nearly 22% of shares in Q1, while Blue Owl Technology Income Corp. saw requests exceeding 40%, suggesting an increasing liquidity demand from retail investors.
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- Financial Metrics Improvement: S&P expects Echo's debt-to-EBITDA ratio to drop to below 6x in the next 12 months, with a projected 6.8x for 2025, demonstrating enhanced financial health post-acquisition, which could lead to an improved credit rating.
- Significant EBITDA Growth: S&P forecasts Echo's EBITDA to rise by $114 million to $247 million, reflecting ITS's contribution that will significantly enhance the company's profitability and strengthen its market competitiveness.
- Free Cash Flow Increase: Post-acquisition, Echo's free cash flow is expected to rise from $10 million in 2026 to $30 million, reaching $50 million in 2027, indicating improved liquidity and enhanced financial stability resulting from the acquisition.
See More
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- Teleconference Invitation: The company invites investors to join a teleconference led by CEO Rob Fauber and CFO Noémie Heuland to discuss the Q1 results, enhancing transparency and investor confidence.
- Meeting Time and Duration: The teleconference is scheduled for April 22, 2026, at 9:00 a.m. ET, lasting one hour, offering in-depth financial analysis and future outlook.
- Replay Service: A replay of the call will be available immediately after the meeting on April 22, 2026, and will last until April 29, ensuring that investors who cannot attend live can access critical information.
See More
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- Credit Rating Upgrade: Moody's has upgraded Flagstar Bank's Long-Term Deposit rating from Ba1 to Baa3 and Short-Term Deposit rating from Not Prime to Prime-3, marking the bank's first attainment of investment-grade status, reflecting significant improvements in its financial performance.
- Financial Performance Improvement: The rating upgrade is attributed to Flagstar's successful remediation of previously identified material weaknesses in internal controls over financial reporting, and its progress towards sustainable profitability, with expectations of a stable Return on Average Assets above 0.5%, enhancing market confidence.
- Expanded Market Impact: The attainment of investment-grade deposit ratings is expected to enhance Flagstar's funding profile, expanding access to corporate, institutional, and municipal deposit relationships, thereby further supporting its business growth and market share increase.
- Strategic Significance: This rating upgrade follows a similar action by Fitch in March, indicating Flagstar's ongoing efforts to strengthen its balance sheet and improve credit quality, showcasing its robust growth potential in a competitive banking landscape.
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