We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Solid Global Bond Issuances to Aid Moody's (MCO) Q3 Earnings
Read MoreHide Full Article
Moody's (MCO - Free Report) is scheduled to report third-quarter 2020 results on Oct 29, before the opening bell. The company’s Corporate Finance line, the largest revenue contributor at the Moody's Investors Service (“MIS”) division, is likely to have recorded higher revenues in the quarter, owing to solid bond issuance volume.
Amid the coronavirus outbreak-led economic uncertainty, lower interest rates supported debt issuances in the to-be-reported quarter. During the quarter, investment-grade bond and high-yield bond issuance volumes witnessed substantial growth. While growth in leveraged loan issuance volumes was subdued in the quarter, revenues under the Corporate Finance line are expected to have improved year over year on the back of solid investment-grade and high-yield issuance volumes.
However, the quarterly issuance volumes for residential mortgage-backed securities and asset-backed securities were soft. Thus, growth in Structured Finance revenues is likely to have been weak.
Hence, while the MIS division’s top line is expected to have gotten support from improvement in Corporate Finance revenues, the same is likely to have been offset to an extent by the expected decline in Structured Finance revenues.
Other Factors at Play
Support from Moody's Analytics (“MA”) Division: With demand for analytics rising, revenues from all units at the MA division are expected to have increased in the third quarter. Also, the company’s efforts to strengthen the division’s profitability through inorganic growth initiatives might have offered some support. Thus, the division’s overall revenues might have risen in the to-be-reported quarter.
High Expenses: Given Moody’s inorganic growth efforts, charges related to strategic acquisition and restructuring costs might have increased in the to-be-reported quarter. Hence, overall expenses for the to-be-reported quarter are likely to have been elevated.
Earnings and Sales Growth Expectations
The Zacks Consensus Estimate for the company’s earnings of $2.19 for the to-be-reported quarter has moved 12.3% upward over the past 30 days. The figure indicates growth of 1.9% from the year-ago reported number. The consensus estimate for sales of $1.25 billion suggests a 0.6% rise.
Earnings Whispers
Our quantitative model predicts an earnings beat for Moody’s this time around. This is because it has the right combination of the two key ingredients — a positive Earnings ESP and Zacks Rank #3 (Hold) or higher — for increasing the odds of an earnings beat.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: Earnings ESP for Moody’s is +1.93%.
Zacks Rank: Moody’s currently carries a Zacks Rank #2 (Buy).
Here are a few other finance stocks that you may want to consider, as our model shows that these too have the right combination of elements to post an earnings beat in their upcoming releases.
The Earnings ESP for CullenFrost Bankers (CFR - Free Report) is +1.57% and the company carries a Zacks Rank of 3 at present. It is slated to report quarterly results on Oct 29.
The Earnings ESP for FS KKR Capital Corp. (FSK - Free Report) is +0.99% and it carries a Zacks Rank #3, currently. The company is slated to announce quarterly numbers on Nov 9.
Zacks’ 2020 Election Stock Report:
In addition to the companies you learned about above, we invite you to learn more about profiting from the upcoming presidential election. Trillions of dollars will shift into new market sectors after the votes are tallied, and investors could see significant gains. This report reveals specific stocks that could soar: 6 if Trump wins, 6 if Biden wins.
Image: Bigstock
Solid Global Bond Issuances to Aid Moody's (MCO) Q3 Earnings
Moody's (MCO - Free Report) is scheduled to report third-quarter 2020 results on Oct 29, before the opening bell. The company’s Corporate Finance line, the largest revenue contributor at the Moody's Investors Service (“MIS”) division, is likely to have recorded higher revenues in the quarter, owing to solid bond issuance volume.
Amid the coronavirus outbreak-led economic uncertainty, lower interest rates supported debt issuances in the to-be-reported quarter. During the quarter, investment-grade bond and high-yield bond issuance volumes witnessed substantial growth. While growth in leveraged loan issuance volumes was subdued in the quarter, revenues under the Corporate Finance line are expected to have improved year over year on the back of solid investment-grade and high-yield issuance volumes.
However, the quarterly issuance volumes for residential mortgage-backed securities and asset-backed securities were soft. Thus, growth in Structured Finance revenues is likely to have been weak.
Hence, while the MIS division’s top line is expected to have gotten support from improvement in Corporate Finance revenues, the same is likely to have been offset to an extent by the expected decline in Structured Finance revenues.
Other Factors at Play
Support from Moody's Analytics (“MA”) Division: With demand for analytics rising, revenues from all units at the MA division are expected to have increased in the third quarter. Also, the company’s efforts to strengthen the division’s profitability through inorganic growth initiatives might have offered some support. Thus, the division’s overall revenues might have risen in the to-be-reported quarter.
High Expenses: Given Moody’s inorganic growth efforts, charges related to strategic acquisition and restructuring costs might have increased in the to-be-reported quarter. Hence, overall expenses for the to-be-reported quarter are likely to have been elevated.
Earnings and Sales Growth Expectations
The Zacks Consensus Estimate for the company’s earnings of $2.19 for the to-be-reported quarter has moved 12.3% upward over the past 30 days. The figure indicates growth of 1.9% from the year-ago reported number. The consensus estimate for sales of $1.25 billion suggests a 0.6% rise.
Earnings Whispers
Our quantitative model predicts an earnings beat for Moody’s this time around. This is because it has the right combination of the two key ingredients — a positive Earnings ESP and Zacks Rank #3 (Hold) or higher — for increasing the odds of an earnings beat.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: Earnings ESP for Moody’s is +1.93%.
Zacks Rank: Moody’s currently carries a Zacks Rank #2 (Buy).
Moodys Corporation Price and EPS Surprise
Moodys Corporation price-eps-surprise | Moodys Corporation Quote
Other Stocks to Consider
Here are a few other finance stocks that you may want to consider, as our model shows that these too have the right combination of elements to post an earnings beat in their upcoming releases.
The Earnings ESP for CullenFrost Bankers (CFR - Free Report) is +1.57% and the company carries a Zacks Rank of 3 at present. It is slated to report quarterly results on Oct 29.
Janus Henderson Group plc (JHG - Free Report) is slated to report quarterly earnings on Oct 29. The company, which carries a Zacks Rank of 2 at present, has an Earnings ESP of +1.81%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Earnings ESP for FS KKR Capital Corp. (FSK - Free Report) is +0.99% and it carries a Zacks Rank #3, currently. The company is slated to announce quarterly numbers on Nov 9.
Zacks’ 2020 Election Stock Report:
In addition to the companies you learned about above, we invite you to learn more about profiting from the upcoming presidential election. Trillions of dollars will shift into new market sectors after the votes are tallied, and investors could see significant gains. This report reveals specific stocks that could soar: 6 if Trump wins, 6 if Biden wins.
Check out the 2020 Election Stock Report >>