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NEW YORK - Moody's Corporation (NYSE:MCO) has acquired Numerated Growth Technologies, a loan origination platform for financial institutions, to enhance its lending suite offerings. The deal, terms of which were not disclosed, is not expected to materially impact Moody's financial results for 2024.
The acquisition, announced today, follows a partnership initiated in January 2024, which combined Numerated's technologies with Moody's credit assessment and monitoring expertise. Numerated will now be fully integrated into Moody's Lending Suite, offering an end-to-end loan origination workflow.
Rob Fauber, President and CEO of Moody's, stated that the acquisition aims to accelerate the capabilities of Moody's Lending Suite to provide customers with comprehensive risk data and analytical solutions. He emphasized the need for credible lending solutions as banking customers seek to enhance user experiences and automate processes through digital transformation.
Numerated's platform uses data and artificial intelligence to streamline bank lending processes, improving application, decision-making, and closing through enhanced data integrity. The platform is utilized by financial institutions with combined assets of $3 trillion, and has processed over $65 billion in lending.
Moody's, known for its data, insights, and technologies, assists customers in developing a holistic view of their world to act with confidence. The company has a diverse workforce of approximately 15,000 employees in over 40 countries.
This acquisition is part of Moody's strategic efforts to expand its financial analytics and risk assessment services, further cementing its position in the credit lifecycle management market. The integration of Numerated into Moody's offerings is expected to deliver a more robust solution for financial institutions navigating the digital lending landscape.
The information provided in this article is based on a press release statement.
In other recent news, Moody's Corporation has seen significant developments. The company reported a 23% increase in revenue, reaching $1.8 billion, and a 32% rise in adjusted diluted earnings per share for the third quarter of 2024. This robust financial performance was largely driven by the ratings business and transactional revenue, which surged by 70%.
Baird, an independent analyst firm, has raised the price target for Moody's from $490 to $512, maintaining an outperform rating. The decision was influenced by Moody's Investor Service's excellent performance in the third quarter. However, Moody's Analytics showed a softer performance, viewed as a modest incremental negative.
The company's full-year ratings revenue growth guidance has been raised to the mid-30s percentage range, and adjusted operating margin expectations for the year are now set at 59-60%. Additionally, Moody's adjusted diluted EPS guidance has been increased from $11.90 to $12.10, indicating a 21% growth from the previous year.
Despite potential macroeconomic and geopolitical uncertainties, Moody's maintains an optimistic outlook, planning to capitalize on market trends in private credit and sustainable finance. The integration of RMS is expected to strengthen Moody's position in insurance solutions. These are among the recent developments that continue to shape the company's trajectory.
InvestingPro Insights
Moody's Corporation's acquisition of Numerated Growth Technologies aligns with its strong financial position and growth trajectory. According to InvestingPro data, Moody's boasts a substantial market capitalization of $86.01 billion, reflecting its significant presence in the financial services industry. The company's revenue growth of 20.43% over the last twelve months and a robust EBITDA growth of 35.21% in the same period underscore its ability to expand its business and potentially integrate new acquisitions effectively.
InvestingPro Tips highlight Moody's commitment to shareholder value, having raised its dividend for 15 consecutive years and maintained dividend payments for 27 consecutive years. This consistent dividend policy suggests financial stability and could provide reassurance to investors about the company's ability to fund strategic acquisitions like Numerated without compromising shareholder returns.
Moreover, the acquisition of Numerated's loan origination platform complements Moody's existing strengths. With a high gross profit margin of 72.9% and an operating income margin of 42.04%, Moody's demonstrates efficient operations that could be further enhanced by integrating Numerated's AI-driven technologies into its Lending Suite.
It's worth noting that Moody's is trading at a high P/E ratio of 43.07, which may indicate investor confidence in the company's growth prospects, potentially including the benefits expected from this latest acquisition. For investors seeking more comprehensive analysis, InvestingPro offers 11 additional tips that could provide deeper insights into Moody's financial health and market position.
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