MCO

Moody's reported revenue above $2 billion for the third consecutive quarter, driven by AI infrastructure debt issuance growth (up fourfold year-over-year), high-margin credit ratings, and embedded analytics software with 99% recurring revenue. The company benefits from $5 trillion in refinancing needs over the next four years across the U.S. and EMEA, supported by durable competitive moats from regulatory status and high switching costs.

Moody's reported Q3 2026 adjusted earnings of $4.14 per share, missing the consensus estimate of $4.25, though earnings grew 6% year-over-year. Revenues rose 1% to $2.02B but fell short of expectations.

The results were pressured by increased operating expenses and a 1% decline in Moody's Investors Service revenues due to lower leveraged finance issuance, partially offset by 3% growth in Moody's Analytics. The company reaffirmed its 2026 guidance.

Zacks Research Daily features analysis of 12 major stocks on October 20, 2026. SAP benefits from strong AI strategy and large deal bookings despite underperformance, while Accenture faces economic uncertainty but gains from enterprise transformation demand.

Moody's outperforms its industry with strong earnings, while Peoples Bancorp shows margin expansion but faces credit risks. Additional coverage includes Nucor, Tenet Healthcare, Toast, and other companies with mixed growth prospects.

Moody's is set to report Q3 2026 earnings on October 21, with consensus estimates projecting 8.4% earnings growth and 2.7% revenue growth to $2.06 billion. The MIS division is expected to benefit from healthy bond issuance, though Corporate Finance revenues are projected to decline 8.9% year-over-year.

Moody's Analytics division is anticipated to grow 2.9% driven by recurring subscriptions and AI tools. However, the company has a negative Earnings ESP of -1.46%, suggesting low probability of beating estimates.

Moody's is expected to report Q3 2026 earnings of $4.24 per share with 2.6% revenue growth, but a negative Earnings ESP of -2.32% suggests analysts have recently become bearish, making an earnings beat unlikely. In contrast, Synchrony shows a positive Earnings ESP of +2.69% with a Zacks Rank #3, indicating it is more likely to beat consensus estimates despite a 13.3% year-over-year EPS decline.

Greg Abel, nine months into his tenure as Berkshire Hathaway CEO, is reshaping the company's $350 billion equities portfolio. He has designated Apple, American Express, Coca-Cola, and Moody's as core holdings with limited activity expected.

Meanwhile, Abel has significantly increased positions in Alphabet (now 10.6% of portfolio), initiated new stakes in Delta Airlines, and increased exposure to housing through Lennar. Energy holdings like Chevron and Occidental Petroleum remain uncommitted, while Bank of America has been slightly trimmed. Abel has also resumed share repurchases after years of pause.

Moody's has been upgraded to a Zacks Rank #2 (Buy) rating, primarily driven by upward trends in earnings estimates. The credit ratings agency is positioned in the top 20% of Zacks-covered stocks based on earnings estimate revisions, suggesting potential near-term stock price appreciation. Analysts have steadily raised estimates over the past three months, with a 1.7% increase in the Zacks Consensus Estimate.

Cribl announced the winners of its inaugural GOAT Customer Awards at CriblCon 2026, recognizing organizations excelling in telemetry data management and AI-driven workflows. Winners include Moody's (Data in Control), ServiceNow (Scale Without Limits), Prudential Financial and University of Nebraska (AI Acceleration), and Blackwood Associates (Partner Innovation).

Primis Financial is expected to report Q3 2026 earnings on October 22 with consensus EPS of $0.45 (up 60.7% YoY) and revenues of $51.21 million (up 24.9% YoY). However, the stock carries a Zacks Rank #4 with a +4.44% Earnings ESP, making it difficult to predict an earnings beat. The company has a poor recent track record, missing estimates in 3 of the last 4 quarters with a -43.90% surprise last quarter.