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The Zacks Consensus Estimate for second-quarter earnings has declined by a penny to $3.11 per share over the past 30 days, suggesting 11.87% growth from the figure reported in the year-ago quarter.
The consensus mark for revenues is pegged at $603.77 million, indicating an increase of 9.42% from the year-ago quarter.
Notably, MSCI’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 4.73%.
Let’s see how things have shaped up for the upcoming announcement.
Factors to Note
MSCI’s second-quarter 2023 results are expected to benefit from robust recurring revenues and the increasing uptake of climate and ESG solutions in the investment process.
The expanding usage of ESG tools bodes well for the company. The retention rate for ESG and Climate tools was 96% in the first quarter of 2023, reflecting strong demand for Ratings, Climate and Screening products.
Our model estimate for ESG and Climate retention rate is pegged at 96.6% for the second quarter of 2023.
Moreover, MSCI’s focus on expanding into new areas like Wealth Management, Insurers, Derivatives, case funds, broker-dealers and ESG & Climate is expected to have driven growth in its customer base in the to-be-reported quarter.
The company’s strengthening portfolio with the addition of solutions like biodiversity screens and insights, as well as multi-horizon climate probability of default, is expected to have driven the top line.
Our model estimate for ESG and Climate operating revenues is pegged at $63.8 million, indicating 10.7% year-over-year growth. The estimate reflects slowing sales on a sequential basis due to ongoing regulatory headwinds in Europe. MSCI witnessed a slowdown among wealth managers and retail investors in the United States.
Nevertheless, the company is riding on the ongoing tech-driven data transformation as it improves the client experience. The partnerships with Microsoft Azure and Google Cloud are noteworthy in this regard.
These factors are expected to have benefited Index and Analytics operating revenues. Our model estimates for Index and Analytics are pegged at $344.7 million and $153.3 million, respectively. On a year-over-year basis, Index and Analytics are estimated to grow 7.4% and 8.2%, respectively.
What Our Model Says
Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.
MSCI has an Earnings ESP of -0.09% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are a few companies worth considering, as our model shows that these have the right combination of elements to beat on earnings in their upcoming releases:
Image: Bigstock
MSCI Scheduled to Report Q2 Earnings: What's in the Cards?
MSCI (MSCI - Free Report) is set to report its second-quarter 2023 results on Jul 25.
The Zacks Consensus Estimate for second-quarter earnings has declined by a penny to $3.11 per share over the past 30 days, suggesting 11.87% growth from the figure reported in the year-ago quarter.
The consensus mark for revenues is pegged at $603.77 million, indicating an increase of 9.42% from the year-ago quarter.
Notably, MSCI’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 4.73%.
MSCI Inc Price and EPS Surprise
MSCI Inc price-eps-surprise | MSCI Inc Quote
Let’s see how things have shaped up for the upcoming announcement.
Factors to Note
MSCI’s second-quarter 2023 results are expected to benefit from robust recurring revenues and the increasing uptake of climate and ESG solutions in the investment process.
The expanding usage of ESG tools bodes well for the company. The retention rate for ESG and Climate tools was 96% in the first quarter of 2023, reflecting strong demand for Ratings, Climate and Screening products.
Our model estimate for ESG and Climate retention rate is pegged at 96.6% for the second quarter of 2023.
Moreover, MSCI’s focus on expanding into new areas like Wealth Management, Insurers, Derivatives, case funds, broker-dealers and ESG & Climate is expected to have driven growth in its customer base in the to-be-reported quarter.
The company’s strengthening portfolio with the addition of solutions like biodiversity screens and insights, as well as multi-horizon climate probability of default, is expected to have driven the top line.
Our model estimate for ESG and Climate operating revenues is pegged at $63.8 million, indicating 10.7% year-over-year growth. The estimate reflects slowing sales on a sequential basis due to ongoing regulatory headwinds in Europe. MSCI witnessed a slowdown among wealth managers and retail investors in the United States.
Nevertheless, the company is riding on the ongoing tech-driven data transformation as it improves the client experience. The partnerships with Microsoft Azure and Google Cloud are noteworthy in this regard.
These factors are expected to have benefited Index and Analytics operating revenues. Our model estimates for Index and Analytics are pegged at $344.7 million and $153.3 million, respectively. On a year-over-year basis, Index and Analytics are estimated to grow 7.4% and 8.2%, respectively.
What Our Model Says
Per the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.
MSCI has an Earnings ESP of -0.09% and a Zacks Rank #3. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stocks to Consider
Here are a few companies worth considering, as our model shows that these have the right combination of elements to beat on earnings in their upcoming releases:
Tyler Technologies (TYL - Free Report) has an Earnings ESP of +0.54% and sports a Zacks Rank #1, at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Tyler shares have gained 29.9% year to date. TYL is set to report its second-quarter 2023 results on Jul 27.
Cadence Design Systems (CDNS - Free Report) has an Earnings ESP of +0.67% and a Zacks Rank #1.
Cadence Design shares have gained 51.2% year to date. CDNS is set to report its second-quarter 2023 results on Jul 24.
Meta Platforms (META - Free Report) has an Earnings ESP of +6.56% and a Zacks Rank #2.
Meta Platforms shares have gained 159.3% year to date. META is set to report its second-quarter 2023 results on Jul 26.
Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.