Moody's Boosts Guidance on Higher Issuance Activity
29 September 2016 - 12:10AM
Dow Jones News
Moody's Corp. said a pickup in debt issuance and a bigger impact
from cost-cutting initiatives have improved its business recently,
leading the company to lift its annual guidance.
The ratings firm said it now expects unadjusted earnings of
$4.70 to $4.80 share, up from its previous outlook for $4.55 a
share. The updated guidance includes a noncash foreign exchange
gain of about 18 cents, as well as a 4-cent restructuring charge
associated with cost management. Moody's said it expects to book
the restructuring charge in its third quarter and the
foreign-exchange gain in its fourth quarter.
"Increased issuance activity combined with a greater impact from
our cost savings initiatives has resulted in a modestly improved
outlook," said Chief Executive Raymond McDaniel, ahead of
Wednesday's investor conference in New York.
In July, the company—which relies on activity in global credit
markets as corporations and lenders pay firms like Moody's to rate
the debt they issue—said revenue edged up in the second quarter as
bond issuance recovered, though said heightened market uncertainty
outside of the U.S. would pressure full-year results.
While the guidance issued today is a boost from July's outlook,
it is still below the $4.75 to $4.85 Moody's initially projected in
February.
Moody's also for the first time this year offered an adjusted
EPS outlook of $4.55 to $4.65 a share, which excludes the forex
gain and restructuring charge.
Shares in the company, inactive premarket, have risen 9.6% so
far this year.
Write to Anne Steele at Anne.Steele@wsj.com
(END) Dow Jones Newswires
September 28, 2016 09:55 ET (13:55 GMT)
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