Earnings come in better than expected, but to mixed reviews. The company slashed costs and jobs to improve the bottom line, but core revenues fell on ratings business weakness
Moody's stock price fell on Thursday, November 15, after an analyst at JP Morgan said he expected the issue of new commercial mortgage-backed securities (CMBS) to fall significantly in the fourth quarter. These securities account for around 5% of Moody's revenue, so a substantial drop in the number of CMBS issued could have a material impact on the company's earnings.
In its October 24th earnings release, Moody's reported a 13% drop in quarterly profits, citing generally weak market conditions as the reason for the decline. The company's stock fell from the previous day's close of $47.38 to $45.93.
The SEC unanimously agreed to adopt the rules of the Credit Rating Agency Reform Act of 2006.
MCO announces profit growth of 20% and raises its revenue guidance.
A number of bankruptcies surfaced in the US mortgage market, causing diminished issuance of structured debt.
MCO acquires sophisticated analysis software firm, Wall Street Analytics for an undisclosed sum.