Moody’s Corporation (NYSE:MCO) released Q4 and 2017 results today. They showed that the company was able to achieve record revenue in both its Investors Service and Analytics businesses. It also benefitted from the contribution of Bureau van Dijk following its acquisition.
The company’s Q4 adjusted EPS was up 20% from the comparable period, with it standing at $1.51. This helped to push its adjusted EPS for the full year to $6.07.
The company expects to report another year of strong growth in 2018. It anticipates that robust economic activity is set to continue across most markets. The recent investments it has made in its products and services could also have a positive impact on its performance in my view.
Looking ahead to next year, Moody’s expects to report adjusted EPS of between $7.65 and $7.85 for the 2018 financial year. This would represent a clear improvement on its previous year’s performance, and may act as a catalyst on investor sentiment in my opinion.
Sure, the outlook for the US and global economies may have changed in recent trading sessions. Investor sentiment has moved noticeably lower in recent days, as the prospect of higher interest rates has dominated news headlines. This could cause further disruption in the near term in my view, with investors gradually changing their forecasts for the next few years. Therefore, the company’s stock price could be volatile.
However, in my view Moody’s continues to offer upside potential. I believe it has a sound strategy that is focused on investing in its various business areas. With last year being a record year for the company, its business model seems to be working well and I wouldn’t be surprised if this situation continues over the coming years.
Therefore, I’m bullish on the stock’s outlook and feel it could perform relatively well in the long run. Further gains could be ahead following its 42% rise in the last year.