BMO Capital Cuts Moody's (MCO) Target as Sector Valuations Compress

Moody’s Corporation (NYSE:MCO) is included among the 14 Best Warren Buffett Dividend Stocks to Buy.

On February 9, BMO Capital lowered its price recommendation on Moody’s Corporation (NYSE:MCO) to $480 from $561. It reiterated a Market Perform rating on the stock. The analyst noted that the company delivered stronger-than-expected results, supported by solid debt issuance activity. Even so, the firm reduced its price target due to multiple compressions across the sector, despite raising its earnings forecasts.

During the Q4 2025 earnings call, President and CEO Robert Fauber said 2025 was a record year for Moody’s. Total revenue exceeded $7.7 billion, marking a 9% increase from the previous year. He also pointed to improved profitability, with adjusted operating margin reaching 51.1%, an expansion of 300 basis points. Adjusted diluted EPS came in at $14.94, reflecting 20% growth compared with the prior year.

Fauber said the company ended the year on a strong note, with solid fourth-quarter performance across both its Ratings and Analytics segments. This momentum supported overall growth and allowed Moody’s to return significant capital to shareholders.

He also highlighted Moody’s progress in artificial intelligence. The company is expanding its decision-grade contextual intelligence capabilities and integrating them directly into customer workflows, including its own platforms, third-party systems, and AI-powered tools. Fauber added that private credit revenue within Moody’s Investors Service rose nearly 60% in 2025. During the year, Moody’s rated $6.6 trillion in debt, the highest volume in its history.

Moody’s Corporation (NYSE:MCO) operates as a global risk assessment company. It provides research, data, analytics, and decision-making tools that help businesses and institutions evaluate risk and make informed financial decisions.

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