3 Stocks to Buy According to Dan Juran’s Rings Capital

2. Moody’s Corporation (NYSE:MCO)

Juran’s Stake Value: $84.2 million

Moody’s Corporation (NYSE:MCO) is a New Mexico-based business and financial services company that was founded in 1909. The company has a market cap of $66.64 billion.

As of the end of the third quarter, Rings Capital Management owns a stake worth $84.2 million in Moody’s Corporation (NYSE:MCO).

Qualivian Investment Partners, in its second-quarter 2021 investor letter, emphasized that Moody’s Corporation (NYSE:MCO) leveraged strong revenue growth with strong operating profit margin improvement. Here is what the fund said:

“Moody’s: Revenue, operating profit margins, and EPS all exceeded expectations, and annual guidance for these items (and for free cash flow) was raised. In MIS (Moody’s Investors Service) which houses the traditional ratings business, the outlook for debt issuance was raised for the remainder of the year, while MA (Moody’s Analytics) also came in ahead of expectations. The company leveraged strong revenue growth with strong operating profit margin improvement of 200 bps, with EPS coming in $0.22 ahead of consensus estimates. Management alluded to having interesting opportunities in their M&A pipeline, which we will have to assess when the time comes, but Moody’s management team has been very effective at allocating capital in the past toward value-creating bolt-on acquisitions, especially in their Moody’s Analytics business, a key growth driver for the company.”