MSCI

Yesterday evening two more stocks were added to the portfolio. New additions see below; addition: $ASML (+0,02 %) Position doubled.

Too $MSCI (+1,01 %) thanks and @topicswithhead for the great analysis!

Innovations in the trial custody account/children's custody account/savings plan custody account or whatever $AMUN (-0,52 %) flies out. Not necessarily because of the figures. I actually thought they were quite good, but what they did with my beloved World ETF was enough for me.

Still considering $MSCI (+1,01 %) or $BLK but haven't had time to take a closer look yet.

Nevertheless, there will be 4 new additions next month.

$6758 (+0,46 %)

$FUL (+0,35 %)

$MKC (+1,66 %)

$V (+0,63 %)

MSCI O3 2024 $MSCI (+1,01 %)

Financial performance:

MSCI Inc. demonstrated strong financial performance with total operating revenues of $724.7 million for the third quarter of 2024, representing an increase of 15.9% compared to the same period in 2023. This growth was driven by increases in all segments, particularly in recurring subscriptions and fee-based assets.

Balance sheet analysis:

The balance sheet as of September 30, 2024 shows total assets of USD 5.41 billion compared to USD 5.52 billion at the end of 2023. Cash and cash equivalents increased to USD 501.0 million, while receivables decreased significantly to USD 643.8 million. Total liabilities amounted to USD 6.16 billion, resulting in an equity deficit of USD 750.998 million.

Income statement:

The income statement shows a net profit of USD 280.9 million for the third quarter of 2024, an increase of 8.2% compared to the previous year. Earnings per diluted share rose to USD 3.57, which represents an increase of 9.2 %.

Cash flow analysis:

Net cash flow from operating activities increased by 44.8 % to USD 421.6 million in the third quarter of 2024, which is attributable to higher incoming payments from customers. Free cash flow also recorded a significant increase of 45.8% to USD 394.0 million.

Key figures and profitability:

The adjusted EBITDA margin improved to 62.2 % compared to 61.8 % in the previous year, reflecting increased operational efficiency. The ratio of total debt to adjusted EBITDA amounted to 2.7x and was therefore within the company's target range of 3.0x to 3.5x.

Segment analysis:

• Index segment: Operating revenues increased 11.8% to $404.9 million, driven by higher fee-based assets and recurring subscription revenues.
• Analytics segment: Revenues increased 11.7% to USD 172.4 million, mainly due to growth in multi-asset class and equity analytics products.
• ESG and Climate segment: Revenues increased by 14.5% to USD 83.6 million, with significant contributions coming from ratings, climate and screening products.
• Other - Private Assets segment: Sales increased by 77.2% to USD 63.8 million, mainly due to the acquisition of Burgiss.

Competitive analysis:

MSCI is strengthening its market position through strategic acquisitions and product diversification, particularly in the ESG and climate segment, which is gaining traction in the investment community.

Management forecasts and comments:

Management is optimistic about future growth and is focusing on continued investment in product development and customer retention. The company strives to maintain its competitiveness through innovation and strategic acquisitions.

Risks and opportunities:

The main risks include possible fluctuations in exchange rates and changes in the regulatory environment. However, opportunities exist in the expansion of the ESG offering and the use of technological advances to improve the product range.

Summary and strategic implications:

MSCI Inc. exhibits strong financial stability and growth potential, supported by robust revenue growth across all segments and improved profitability metrics. The company's strategic focus on ESG and technological innovation positions it well for future expansion. However, careful management of foreign exchange risks and regulatory changes is crucial to sustain this growth. A clear buy and hold for me. A cash machine.

Positive statements

• Revenue growth in operating business: MSCI Inc. reported a significant increase in operating revenues, which totaled $724.7 million for the three months ended September 30, 2024, an increase of 15.9% compared to the same period in 2023.
• Increase in net profit: Net profit for the third quarter of 2024 was USD 280.9 million, an increase of 8.2% year-on-year.
• Growth in adjusted EBITDA: Consolidated Adjusted EBITDA increased to USD 450.7 million in the third quarter of 2024, compared to USD 386.3 million in the same period last year.
• Earnings per share improvement: Earnings per diluted common share increased to $3.57, representing a 9.2% year-over-year increase.
• Operating cash flow: Net cash flow from operating activities reached USD 1,070.9 million in the first nine months of 2024, up significantly from USD 847.1 million in the same period of 2023.

Negative statements

• Decrease in receivables: Receivables decreased from USD 839.6 million as at December 31, 2023 to USD 643.8 million as at September 30, 2024.
• Increase in operating expenses: Operating expenses increased by 18.8% to USD 323.4 million in the third quarter of 2024 compared to the same period in 2023.
• Decrease in cash and cash equivalents: Cash and cash equivalents decreased from USD 461.7 million at the end of 2023 to USD 501.0 million at September 30, 2024, indicating lower liquidity.
• Higher amortization costs: Amortization of intangible assets increased by 56.9% in the third quarter of 2024 compared to the same period of the previous year.
• Increased negative cash flow from financing activities: Net cash flow from financing activities amounted to USD -926.1 million in the first nine months of 2024, a significant increase compared to USD -842.4 million in the same period of the previous year.

📊 MSCI: More than just indices - the secret data king of the financial markets 👑

MSCI Inc. is a leading global provider of equity, bond and real estate indices as well as multi-asset portfolio analysis tools. The company also offers innovative ESG and climate products that enable institutional investors to develop sustainable investment strategies. Founded in 1968 and headquartered in New York City, the company has $MSCI (+1,01 %) has established itself as an indispensable partner for capital markets and asset managers worldwide.

Historical development

The origins of MSCI date back to 1968, when Capital International first published global equity indices for non-US markets. In 1986, Morgan Stanley secured the license rights and coined the name Morgan Stanley Capital International (MSCI). With the acquisition of Barra in 2004, MSCI added analytical tools to its portfolio. The IPO in 2007 marked a further milestone, which was completed in 2009 with the full spin-off of $MS (+0,47 %) Stanley in 2009.

Business model and core competencies

MSCI's business model rests on four central pillars:

1. index segment : development and licensing of globally recognized equity indices, including the MSCI World and MSCI Emerging Markets.

2. analytical segment: provision of sophisticated portfolio analysis tools used primarily by asset managers and hedge funds.

3. ESG segment: MSCI is a pioneer in sustainable investing and provides comprehensive ESG analysis to support environmental and socially responsible investment strategies.

4. private assets: diversification into unlisted assets, in particular real estate and private equity.

MSCI's core competence lies in the development of global indices that offer investors a comprehensive representation of opportunities and risks across different sectors and countries. A key competitive advantage is decades of data collection, which is crucial for strategy development, portfolio management and risk analysis.

Market position and competition

MSCI has established itself as one of the global market leaders in financial indices and acts neutrally towards regulatory authorities worldwide. This independence has enabled the company to generate 17% of its revenue in the Asia-Pacific region - a significant advantage over competitors such as $SPGI (+0,94 %) which only achieve a share of less than 3% in this region.

Future prospects and strategic initiatives

MSCI's future strategy is characterized by continuous innovation and expansion.

1. ESG and climate products: The acquisition of Carbon Delta in 2019 strengthened MSCI's position in climate risk analytics and sustainability.

2. private asset segment: Through acquisitions such as Real Capital Analytics (2021) and Burgiss Group (2023), MSCI is expanding its expertise in unlisted assets

3. options: A cooperation with Cboe Global Markets since 2021 opens up new opportunities in options trading on MSCI indices.

4. fixed income indices: The development of new bond indices in collaboration with MarketAxess (2022) demonstrates MSCI's efforts to gain a stronger foothold in the fixed income space.

Total Addressable Market (TAM) and equity performance

The total market that MSCI addresses is enormous: over 13 trillion US dollars are invested worldwide in funds based on MSCI indices. The company continuously generates income through license fees of 0.02 to 0.04 percent of assets under management.

For the development (company figures), a better view and more, check out the free blog: https://topicswithhead.beehiiv.com/p/msci-mehr-als-nur-indizes-der-heimliche-datenk-nig-der-finanzm-rkte

Conclusion

MSCI's business model may seem simple at first glance, especially because it is easy to imitate, but it is not that simple. MSCI has established a strong brand with high recognition value, even among retail providers, and enjoys excellent relationships with asset managers. In addition, the company benefits from an extremely attractive business model, with high profitability, impressive scaling synergies and a promising trend. Revenues are recurring and therefore highly predictable and MSCI has successfully positioned itself in all markets, which is also reflected in an attractive revenue distribution. Capital efficiencies have been at a first-class level for some time and there are therefore few negative aspects, apart from the high level of debt, which at the same time offers leverage and a high valuation. Anyone who can acquire the shares at a lower price after a small crash should definitely buy them, as the company is a real cash machine if managed correctly.

I have sold 2 shares

see my posts and would like to $V (+0,63 %) buy new and $MSCI (+1,01 %) top up

When would you get in with Visa?

vG

I am still bullish about $MSCI (+1,01 %) but in the current situation it is too highly valued for me with an unconvincing risk/reward ratio.

The earnings will be in $BN (+0,91 %) and $GOOGL (+0,79 %) reinvested.

Sale of Vonovia, capital will be invested tomorrow via a savings plan in $MSCI (+1,01 %) invested

1st tranche - if the share continues to fall, more will follow 📈

Hello stock market friends,

I would be interested in your assessment of my Quality Growth portfolio.

I currently feel comfortable with the portfolio, even though it is very technology-focused.

My approach is to only buy absolute quality companies with positive growth prospects at fair valuations. Some companies are simply rarely available at fair valuations ($ANET (+0,96 %)
$SNPS (+1,48 %) and co.), which is why I am prepared to add such companies with strong moats to my portfolio at a premium.

I am currently considering whether $MSCI (+1,01 %) after the market punished the last quarterly figures.

I am also keeping a closer eye on $ZTS (+0,53 %) more closely due to the recent setbacks. Fundamentally, the company is still operating excellently and is starting to look more attractively valued than it did a few months ago.

What stocks do you know that could be a good addition to my portfolio?

LG