Chuck Akre’s Top 5 Stock Holdings

2. Moody’s Corporation (NYSE: MCO)

Moody’s Corporation (NYSE: MCO) was the second largest holdings of Chuck Akre, with a position valued at $1.63 billion. The asset manager has been investing in Moody’s since 2012 and owns 5.6 million shares with an 11.05% weight in the portfolio.

Moody’s Corporation is known as one of the major credit rating agencies operating through two segments: Moody’s Investors Service and Moody’s Analytics. The company enjoys strong revenues regardless of the economy’s state, since credit rating services increase during potential crisis periods. In fact, Moody’s has increased its dividend for 18 consecutive years. It is currently paying $0.62 per share on a quarterly basis. Moreover, the company executed regular share buybacks and is expected to return $1.5 billion to its shareholders through share repurchases, which will further boost its earnings per share over time.

Moody’s was very active recently on the acquisition level:

• It acquired ZM Financial Systems to broaden its enterprise risk solutions for the U.S. banking sector;
• It entered into a definitive agreement to acquire Cortera, which provides credit data and workflow solutions in North America;
• It acquired Catylist, a provider of commercial real estate solutions for brokers, expanding its analytical solutions offerings to the brokerage market.

For 2021, diluted EPS is forecasted in the range of $9.70 to $10.10 while free cash flow is expected to be in the range of $1.9 billion to $2.1 billion.