Moody's (Moody's) Interest Coverage

: 6.43 (As of Dec. 2023)

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Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income by its Interest Expense. Moody's's Operating Income for the three months ended in Dec. 2023 was $534 Mil. Moody's's Interest Expense for the three months ended in Dec. 2023 was $-83 Mil. Moody's's interest coverage for the quarter that ended in Dec. 2023 was 6.43. The higher the ratio, the stronger the company's financial strength is.

The historical rank and industry rank for Moody's's Interest Coverage or its related term are showing as below:

MCO' s Interest Coverage Range Over the Past 10 Years
Min: 6.74 Med: 9.16 Max: 14.15
Current: 6.74

MCO's Interest Coverage is ranked worse than
61.56% of 450 companies
in the Capital Markets industry
Industry Median: 19.12 vs MCO: 6.74

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Moody's Interest Coverage Historical Data

The historical data trend for Moody's's Interest Coverage can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

Note: For Interest Coverage, "No debt" indicates no long-term debt. An indication of "No Debt" does not necessarily mean that the company has no long-term debt obligations; it could be due to missing data in the quarterly or annual report. Use caution when interpreting this information.

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Moody's Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Interest Coverage

9.22

11.94

14.15

8.12

6.91

Moody's Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Interest Coverage																5.46	7.47	6.51	6.61	6.43

Competitive Comparison

For the Financial Data & Stock Exchanges subindustry, Moody's's Interest Coverage, along with its competitors' market caps and Interest Coverage data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Moody's Interest Coverage Distribution

For the Capital Markets industry and Financial Services sector, Moody's's Interest Coverage distribution charts can be found below:

* The bar in red indicates where Moody's's Interest Coverage falls into.

Moody's Interest Coverage Calculation

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

If Interest Expense is negative and Operating Income is positive, then

Interest Coverage

-1

Operating Income

Interest Expense

Else if Interest Expense is negative and Operating Income is negative, then

The company did not have earnings to cover the interest expense.

Else if Interest Expense is 0 and Long-Term Debt & Capital Lease Obligation is 0, then

The company had no debt ⁽¹⁾.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Moody's's Interest Coverage for the fiscal year that ended in Dec. 2023 is calculated as

Here, for the fiscal year that ended in Dec. 2023, Moody's's Interest Expense was $-322 Mil. Its Operating Income was $2,224 Mil. And its Long-Term Debt & Capital Lease Obligation was $7,307 Mil.

Interest Coverage	=	-1	*	Operating Income (A: Dec. 2023 )	/	Interest Expense (A: Dec. 2023 )
	=	-1	*	2224	/	-322
	=	6.91

Moody's's Interest Coverage for the quarter that ended in Dec. 2023 is calculated as

Here, for the three months ended in Dec. 2023, Moody's's Interest Expense was $-83 Mil. Its Operating Income was $534 Mil. And its Long-Term Debt & Capital Lease Obligation was $7,307 Mil.

Interest Coverage	=	-1	*	Operating Income (Q: Dec. 2023 )	/	Interest Expense (Q: Dec. 2023 )
	=	-1	*	534	/	-83
	=	6.43

The higher the ratio, the stronger the company's Financial Strength is.

Moody's (NYSE:MCO) Interest Coverage Explanation

Ben Graham requires that a company has a minimum interest coverage of 5 with the companies he invested. If the interest coverage is less than 2, the company is burdened by debt. Any business slow or recession may drag the company into a situation where it cannot pay the interest on its debt.

Interest Coverage is an important factor when GuruFocus ranks a company's overage Financial Strength .

Moody's Interest Coverage Related Terms

Thank you for viewing the detailed overview of Moody's's Interest Coverage provided by GuruFocus.com. Please click on the following links to see related term pages.

Moody's (Moody's) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Capital Markets » Moody's Corporation (NYSE:MCO) » Definitions » Interest Coverage

Comparable Companies

Traded in Other Exchanges

MCO:Mexico DUT:Germany DUT:Germany MCOR34:Brazil

Address

7 World Trade Center at 250 Greenwich Street, New York, NY, USA, 10007

Website

https://www.moodys.com

Moody's, along with S&P Ratings, is a leading provider of credit ratings on fixed-income securities. The ratings segment, Moody's Investors Service, includes corporates, structured finance, financial institutions, and public finance ratings. MIS represents a majority of the firm's revenue and profits. The other segment, Moody's Analytics, consists of research, data, and analytics as well as enterprise risk solutions. RD&A's products include credit research, quantitative credit scores, economic research, business intelligence, know-your-customer tools, commercial real estate data and analytical tools, and training services. ERS includes risk-management software solutions for financial institutions.

Executives

Robert Fauber	director, officer: President and CEO	7 WORLD TRADE CENTER, 250 GREENWICH STREET, NEW YORK NY 10007
Michael L West	officer: President, Moody's Investors	7 WORLD TRADE CENTER, 250 GREENWICH ST, NEW YORK NY 10007
Richard G Steele	officer: SVP - General Counsel	C/O MOODY'S CORPORATION, 7 WORLD TRADE CENTER AT 250 GREENWICH ST, NEW YORK NY 10007
Kathryn Hill	director	7 WORLD TRADE CENTER, 250 GREENWICH STREET, NEW YORK NY 10007
Lloyd Jr Howell	director	8283 GREENSBORO DRIVE, MCLEAN VA 22102
Vincent A Forlenza	director	C/O BECTON DICKERSON & CO, 1 BECTON DR, FRANKLIN LAKES NJ 07417
Jorge A. Bermudez	director	CORPORATE LAW DEPT., CITIGROUP INC., 425 PARK AVENUE, NEW YORK NY 10043
Jose Minaya	director	7 WORLD TRADE CENTER, 250 GREENWICH STREET, NEW YORK NY 10007
Saun Bruce Van	director	CITIZENS FINANCIAL GROUP, INC., 600 WASHINGTON BLVD, STAMFORD CT 06901
Leslie Seidman	director	7 WORLD TRADE CENTER, 250 GREENWICH STREET, NEW YORK NY 10007
Therese Esperdy	director	7 WORLD TRADE CENTER, 250 GREENWICH ST, NEW YORK NY 10007
Caroline Sullivan	officer: SVP - Corporate Controller	7 WORLD TRADE CENTER, 250 GREENWICH STREET, NEW YORK NY 10007
Mark Kaye	officer: EVP & Chief Financial Officer	7 WORLD TRADE CENTER, 250 GREENWICH ST, NEW YORK NY 10007
Raymond W Mcdaniel	director, officer: Executive Vice President	7 WORLD TRADE CENTER, 250 GREENWICH STREET, NEW YORK NY 10007
Stephen T Tulenko	officer: President, Moody's Analytics	7 WORLD TRADE CENTER, 250 GREENWICH ST, NEW YORK NY 10007