By Rob Curran
Moody's Corp. posted a marked increase in fourth-quarter net income and forecast more growth in 2024 as the company's bond-rating and financial-research arms benefit from a rebound in credit markets and stabilizing economic conditions.
The New York credit-ratings and research firm said fourth-quarter earnings rose to $340 million, or $1.85 a share, from $246 million, or $1.34 a share, a year earlier. Excluding certain one-off items, Moody's logged fourth-quarter earnings of $2.19 a share, shy of the average analyst estimate of $2.33 a share, as tallied by FactSet.
Fourth-quarter revenue surged 15% to $1.48 billion, compared with the average analyst target of $1.49 billion, as tabulated by FactSet. Revenue at its Moody's Analytics research unit rose 11% to $796 million during the three-month period. Revenue at the Moody's Investors Service credit-ratings unit rose by 19% to $684 million, growth the company attributed to a rebound in Treasury markets and a brightening economic outlook. Moody's said bank-loan rating demand was the strongest since early 2022.
For 2024, Moody's targeted earnings in a range between $9.45 a share and $10.20 a share, or between $10.25 a share and $11 a share on an adjusted basis. For 2023, Moody's logged earnings of $8.73 a share.
Moody's based its earnings projection on an assumption of U.S. gross-domestic product expansion of 1%-to-2%, and a decline in the U.S. inflation rate to 2% by the year-end.
Among the risks to the outlook are "the impacts resulting from changes in international conditions, including as a result of the Russia-Ukraine military conflict, and the military conflict in Israel and surrounding areas," Moody's said.
Write to Rob Curran at rob.curran@wsj.com
(END) Dow Jones Newswires
02-13-24 0750ET
