Moody's Corporation (MCO) Stock Valuation — PE Analysis
Financial - Data & Stock Exchanges · NYSE
Current Price
$447.85
PE Ratio (TTM)
31.7x
Intrinsic Value
$536.21
+16.5% margin of safety
COMPETITIVE MOAT
↑Brand and Reputation
Moody's enjoys a deeply entrenched brand synonymous with creditworthiness and financial analysis. This trust is built over decades and is difficult for competitors to replicate.
↑Regulatory Influence
The company's ratings are often mandated or heavily relied upon by regulators and financial institutions globally. This creates a sticky customer base and high switching costs.
↑Data and Analytics Dominance
Moody's possesses vast proprietary data sets and sophisticated analytical tools. This deep understanding of financial markets provides a significant competitive edge.
INVESTMENT RISKS
↓Generative AI Disruption
The upcoming Q&A on generative AI strategy suggests the company is actively exploring this technology. However, AI could potentially disrupt traditional rating methodologies or create new competitors.
↓Regulatory Scrutiny and Change
The financial data industry is subject to evolving regulations. Changes in how ratings are used or perceived could impact Moody's business model and revenue streams.
↓Competition and Innovation Pace
While established, Moody's faces competition from other rating agencies and emerging fintech solutions. Failure to innovate at the pace of technological change poses a risk.
Base case
MCO base case PE valuation
A base case PE valuation for MCO estimates a fair value of about $536.21 per share, against a current price of $447.85. The model assumes 10.6% annual earnings growth, a 32x target PE multiple, and a 10% discount rate.
Intrinsic Value
$536.21
Margin of safety
+16.5%
Expected annual return
+3.7%
Base case assumptions: 10.6% annual earnings growth, 32x target PE, 10% discount rate, 5 year projection. Data as of 2026-06-12.
This base case uses default assumptions and is not financial advice. The fair value changes significantly when the target PE or earnings growth rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the MCO PE valuation
Adjust the target PE, earnings growth, and discount rate to see how the fair value and margin of safety for Moody's Corporation respond.
Open PE Calculator for MCOCompany Overview
Moody's Corporation operates as a global leader in risk assessment, divided into two main segments: Moody's Investors Service and Moody's Analytics. Moody's Investors Service is dedicated to issuing credit ratings and providing detailed assessments for a diverse range of debt obligations and the entities that issue them. This encompasses corporate, financial institution, governmental, and structured finance securities across approximately 140 nations. These ratings are made publicly available through press releases, digital media, and real-time financial information systems. Its vast scope includes ratings for thousands of non-financial corporations, financial institutions, public finance issuers, sovereign and sub-sovereign governments, supranational bodies, infrastructure projects, and structured finance deals. The Moody's Analytics segment develops and provides a comprehensive suite of products and services designed to support the risk management needs of institutional participants in financial markets. This includes subscription-based research, data, and analytical tools such as credit ratings, quantitative credit scores, economic forecasts, business intelligence, commercial real estate data, and specialized training and certification programs. Additionally, this segment offers offshore analytical and research services, along with advanced software solutions for risk management. Originally founded in 1900 and headquartered in New York, New York, the company was known as Dun and Bradstreet Company before officially becoming Moody's Corporation in September 2000.
Financial Metrics — MCO PE Stock Valuation Data
PE Ratio (TTM)
31.7x
PEG Ratio
1.55
Earnings Yield
3.15%
ROE (TTM)
66.7%
Revenue/Share (TTM)
$44.53
Dividend Yield
0.88%
Debt/Equity
2.44x
Frequently Asked Questions
What is the PE ratio of MCO?
The trailing twelve-month PE ratio of MCO reflects how much investors pay per dollar of Moody's Corporation's earnings. This metric is most useful when compared to Financial - Data & Stock Exchanges peers and the company's own historical range.
Is MCO overvalued based on PE ratio?
MCO's PE of 31.7x combined with a PEG ratio of 1.55 provides a growth-adjusted perspective. A PEG near 1.0 suggests the PE ratio is reasonably justified by the earnings growth rate. Keep in mind that PE-based valuation works best for profitable, mature companies — for high-growth or cyclical Financial - Data & Stock Exchanges, a DCF analysis may be more appropriate.
How do I value MCO stock using PE ratio?
To value Moody's Corporation using PE: (1) Compare the current PE (31.7x) against the Financial - Data & Stock Exchanges median to assess relative pricing, (2) check the PEG ratio (1.55) to adjust for growth expectations, (3) review the 5-year PE range to identify where the stock sits historically, and (4) estimate fair value by multiplying a target PE by forward EPS estimates. This relative approach complements DCF's absolute valuation.
What is the PEG ratio of MCO?
MCO's PEG ratio is 1.55, calculated by dividing the PE ratio (31.7x) by the expected earnings growth rate. A PEG near 1.0 suggests the stock is fairly priced relative to growth. Note that PEG accuracy depends on the reliability of growth estimates.
Should I use PE ratio or DCF for MCO stock valuation?
PE ratio gives a quick relative read — how MCO is priced versus Financial - Data & Stock Exchanges peers. DCF provides an absolute value based on projected free cash flows. For MCO, with a strong ROE of 66.7%, both methods are worth using — PE for a market-relative check, DCF to stress-test whether fundamentals justify the price. Each method has blind spots: PE ignores capital structure and cash flow quality, while DCF is sensitive to growth and discount rate assumptions.
Learn More
- See MCO DCF Valuation → — Intrinsic value via Discounted Cash Flow analysis
- PE Methodology — Step-by-step guide to PE ratio stock valuation
- DCF Methodology — Guide to discounted cash flow analysis
- PE Ratio — Understanding the price-to-earnings ratio
- Intrinsic Value — How to evaluate stock fair value
Related PE Valuations
All Financial Services valuationsP/E and DCF value MCO with different methods and assumptions, so the two conclusions can differ. Compare the DCF intrinsic value.
Price as of 2026-06-12. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.