) is set to report first quarter 2014 results on Apr 25. Last
quarter it posted a 10.4% positive surprise. We note that Moody's
has outperformed the Zacks Consensus Estimate in the preceding
four quarters with an average positive surprise of 8.3%.
Let's see how things are shaping up for this announcement.
Growth Factors This Past Quarter
Moody's reported better-than-expected fourth quarter results with
both its earnings and revenue convincingly beating the Zacks
Consensus Estimate. Moreover, management provided an upbeat
outlook for full year 2014.
We believe that Moody's remains a solid franchise in rating debt
instruments based on its diversified credit research business
model and international growth opportunities. Additionally,
accretive acquisitions, improving liquidity, higher dividend
payout and aggressive share buybacks are the other positives.
However, regulatory concerns will remain an overhang on the stock
going forward. Moreover, increasing competition from the likes of
privately held Fitch,
McGraw Hill Financial
) Standard & Poor's division,
Dun & Bradstreet
) is a major concern going forward.
Our proven model does not conclusively show that Moody's is
likely to beat earnings this quarter. That is because a stock
needs to have both a positive
and a Zacks Rank of #1, 2 or 3 for this to happen. That is not
the case here as you will see below.
The Most Accurate estimate coincides with the Zacks Consensus
Estimate of 90 cents. Hence the difference or ESP is 0.0%.
Zacks Rank #3 (Hold):
Moody's Zacks Rank #3 (Hold) when combined with an ESP of 0.00%
makes surprise prediction difficult. We caution against stocks
with Zacks Ranks #4 and #5 (Sell-rated stocks) going into the
earnings announcement, especially when the company is seeing
negative estimate revisions momentum.
DUN &BRADST-NEW (DNB): Free Stock Analysis
EURONET WORLDWD (EEFT): Free Stock Analysis
MOODYS CORP (MCO): Free Stock Analysis Report
MCGRAW HILL FIN (MHFI): Free Stock Analysis
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