Robust Global Bond Issuance Volume to Support Moody's Q3 Earnings

Moody's MCO is scheduled to announce third-quarter 2024 results on Oct. 22, before the opening bell. The company’s Corporate Finance line, the largest revenue contributor at the Moody's Investors Service (“MIS”) division, is likely to have witnessed solid revenue growth.Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.Global issuance activity was strong in the third quarter, driven by historically tighter corporate debt spread and a favorable economic backdrop.All three sub-categories within non-financial corporate bonds (investment grade, high yield and leveraged loans) witnessed gains on a year-over-year basis. The Zacks Consensus Estimate for revenues from the Corporate Finance line of $448.3 million indicates a 29.6% jump from the prior-year quarter’s reported number. The consensus estimate for revenues for the Financial Institutions business line of $179.7 million suggests a 42.6% surge. The Zacks Consensus Estimate for Public, Project and Infrastructure Finance business of $144.2 million implies growth of 25.4%.Quarterly issuance volumes for commercial mortgage-backed securities, collateral debt obligations and asset-backed securities were robust. Thus, Structured Finance revenues are likely to have been favorably impacted. The consensus estimate for the same stands at $121 million, suggesting an 18.6% rise.The Zacks Consensus Estimate for MIS division revenues for the to-be-reported quarter of $934.3 million implies a 34.2% year-over-year increase.Moody’s Other Key Factors & Estimates for Q3Moody's Analytics (“MA”) Division: With demand for analytics rising, revenues from all units at the MA division are expected to have increased in the third quarter. The company’s efforts to strengthen the division’s profitability through inorganic growth strategies are anticipated to have offered some support. Thus, the division’s overall revenues are likely to have risen in the to-be-reported quarter.The consensus estimate for the MA division’s quarterly revenues is pegged at $844.6 million, indicating an 8.8% increase from the prior-year quarter.Expenses: Given Moody’s inorganic growth efforts, charges related to strategic acquisitions and restructuring costs, overall expenses are expected to have increased in the to-be-reported quarter.Earnings Whispers for Moody’sAccording to our proven model, the chances of Moody’s beating the Zacks Consensus Estimate for earnings this time are high. This is because it has the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #3 (Hold) or better.You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.Earnings ESP: The Earnings ESP for Moody’s is +1.67%.Zacks Rank: The company currently carries a Zacks Rank #2 (Buy).MCO’s Q3 Earnings and Sales ExpectationsThe Zacks Consensus Estimate for earnings is pegged at $2.89, which has been revised 5.1% upward over the past seven days. The figure indicates an 18.9% rise from the year-ago reported number. Moody's Corporation Price and EPS Surprise Moody's Corporation price-eps-surprise | Moody's Corporation QuoteThe consensus estimate for sales of $1.73 billion suggests 17.6% growth.Other Finance Sector Stocks Worth a LookHere are a couple of other finance sector stocks that you may want to consider, as our model shows that these too have the right combination of elements to post an earnings beat this time:The Earnings ESP for East West Bancorp EWBC is +0.10% and it carries a Zacks Rank #3 at present. The company is slated to report third-quarter 2024 results on Oct. 22.Over the past seven days, the Zacks Consensus Estimate for EWBC’s quarterly earnings has remained unchanged at $2.05.SEI Investments SEIC is scheduled to release third-quarter 2024 earnings on Oct. 23. The company, which carries a Zacks Rank #2 at present, has an Earnings ESP of +0.62%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.SEIC’s quarterly earnings estimates have remained unchanged at $1.07 over the past week.Zacks Names #1 Semiconductor StockIt's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Moody's Corporation (MCO): Free Stock Analysis Report SEI Investments Company (SEIC): Free Stock Analysis Report East West Bancorp, Inc. 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