Earnings Preview: Moody's

Moody's (MCO) is expected to report Q2 earnings before market open Wednesday July 30, with a conference call scheduled for 11:30 am ET.

Guidance

Analysts are looking for EPS of 47c on revenue of $467.6M. The consensus range for EPS is 43c to 53c, while the consensus range for revenue is $429.6M to $484.29M, according to First Call.

Analyst Views

Moody's announced early this month that it had decided to dismiss the head of its structured finance unit, discipline other employees, and accelerate measures to strengthen its ratings and monitoring processes, following a law firm's comprehensive review of the company's ratings process for European constant-proportion debt obligations, or CPDOs. William Blair reacted favorably to the outcome of the law firm's investigation. The research firm believes the investigation did not result in the worst-case scenario, as the probe found no fraud involving the CPDO ratings and no indication of any issues outside of European CPDOs. The SEC recently found that the three major ratings agencies, including Moody's, violated conflict-of-interest rules and took their own profits into account when determining ratings.