2023-05-09 11:31:27 ET
Wells Fargo on Tuesday started coverage of credit rating providers S&P Global ( NYSE: SPGI ) with an Overweight rating and Moody's ( NYSE: MCO ) with an Equal Weight rating.
For S&P Global ( SPGI ), its merger with IHS Markit announced late 2020 provides the former balanced end market exposure, "strong synergy opportunities, robust capital return capabilities and potential further portfolio options," the firm wrote in a note to clients.
"We believe delivery of and upside to synergy targets, along with continued organic revenue growth acceleration and margin expansion leading to upside to conservative Investor Day targets, will help to abate the conglomerate discountcurrently weighing on the shares," the note said.
Shares of Moody's ( MCO ), meantime, is approaching fair value, Wells Fargo noted, hence the Equal Weight rate. MCO outperformed the Information Services peer group by around 200 basis points, and SPGI by ~380 bps, it added.
The Equal Weight rating aligns with the Quant system rating of Hold and diverges from the average Wall Street analyst rating of Buy.
In late morning trading, SPGI drifted up 0.4% and MCO gained 0.3% .
More on S&P Global and Moody's
For further details see:
S&P Global nabs Overweight rating, Moody's started at Equal Weight at Wells Fargo