Moody's falls after Raymond James downgrades to 'underperform'

Moodys

23/09/2024 19:32

(Updates)
    ** Shares of ratings agency Moody's  MCO.N  fall as much as
3.4%; last down 3.2% at $478.98 
    ** MCO among the worst performers on the S&P 500  .SPX  at
2:20 p.m. (18:20 GMT)
    ** Raymond James downgrades MCO to "underperform" from
"market perform", saying consensus estimates are too high for
ratings business revenue for 2025 and beyond 
    ** Brokerage says that despite impressive strength so far
this year, the bull case for MCO's ratings business is unlikely
to be realized
    ** Brokerage adds that the long-term growth rate for ratings
business has likely shifted lower in recent years due to a
number of factors, including the rapid rise of private credit
and higher interest rates
    ** Rapid growth in unrated private credit lending has likely
come at the expense of rated debt activity - Raymond James 
    ** Eleven of 21 brokerages rate stock "buy" or higher and 10
"hold"; their median PT is $473.33 - LSEG data
    ** As of last close, MCO shares up 26.7% YTD

 (Reporting by Arasu Kannagi Basil in Bengaluru)
 ((ArasuKannagi.Basil@thomsonreuters.com;))