Is Moody’s Stock a Buy?
There are a lot of great long-term stocks available to investors, but few of them have been able to avoid losing value during this historic stock market correction. However, Moody's (NYSE: MCO) has been able to navigate the choppy waters of the last few months, down about 3% year to date. In 2019, the stock was up 69.5%, and over the last 12 months, it is up about 22%. Here are three reasons why Moody's remains a good buy.
When Warren Buffett was asked years ago what he looks for in the companies he invests in, he started with the same idea I'm starting with today: "What we're trying to do is we're trying to find a business with a wide and long-lasting moat around it ... protecting a terrific economic castle with an honest lord in charge of the castle." It all starts with the moat: a distinct competitive advantage that enables a business to maintain pricing power and generate consistent profit margins.
As a leading provider of credit ratings, research, and risk analysis, Moody's has that moat. Moody's is one of just three major credit rating agencies, along with S&P Global and Fitch. These three companies control about 95% of the global market share -- and Moody's is one of the two largest, splitting about 80% of the market with S&P.
Source Fool.com
