MSCI stock is the IBD Stock Of The Day as the financial services company offers an entry off support at a key technical level and works on a traditional buy point.
MSCI provides products and services for investors. Those include indexes used to create and benchmark exchange traded funds and mutual funds.
ETFs tracking MSCI indexes include some of the largest in the world, such as iShares Core MSCI EAFE, iShares Core MSCI Emerging Markets and iShares MSCI EAFE.
The company also taps the rising market for environmental, social and governance (ESG) products and services. And a new Google Cloud pact is poised to leverage growth powered by artificial intelligence, or AI.
On March 6, the global indexing and benchmarking giant returned to the IBD Long-Term Leaders list, backed by a strong earnings record and expectations for double-digit growth.
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MSCI: Solid IBD Ratings
The IBD Stock Checkup tool shows that MSCI stock earns an IBD Composite Rating of 81, RS Rating of 89 and EPS Rating of 95, all out of a best-possible 99.
Mutual funds owning shares in MSCI rose for a third quarter in a row to 2,216 funds in the fourth quarter of 2022, up from 2,098 in Q3. Fidelity Contrafund (FCNTX), T. Rowe Price New Horizons (PRNHX), Janus Henderson Enterprise (JAENX) and Baron Asset Retail (BARAX) all own shares in this financial stock.
MSCI Stock
Shares of the index provider rose 1.4% to 529.61 on the stock market today, doing better than just holding their ground as a large share of financial and banking stocks headed lower. In the process, shares rebounded from a test of the 50-day moving average, and cut back above a down-sloping trendline in the handle of a long, deep base.
Under normal circumstances, that would present a buy opportunity for aggressive investors. But the market status is currently in correction, discouraging traders from making new purchases. In addition, the volatility of the banking sector leaves the upcoming direction of the market far from clear.
In this case, it is better to wait to see whether shares rise to the 572.60 buy point in the cup-with-handle base. The handle formed after a 9% earnings surge the week ended Feb. 3.
The relative strength line for MSCI stock has risen to a year-plus high, the MarketSmith chart shows. A rising RS line means that a stock is outperforming vs. the S&P 500. That is just the kind of stock you want to find in a weakening market. When circumstances improve, it's more likely to be a leader.
The 89 Relative Strength Rating means that MSCI stock has outperformed 89% of all stocks in IBD's database over the past year.
On Monday, the SVB Bank collapse continued to whack bank and financial stocks hard. But MSCI is attempting a rally after taking last week's decline in stride.
In fact, MSCI fell in four of the last five weeks. But volume during that pullback was mild, a good sign.
MSCI Earnings
The New York City-based company boasts an enviable record of earnings growth.
Earnings increased steadily throughout the Covid pandemic, up 15% to 27% over the past three years.
Growth slowed to around 13% in each of the past three quarters. However, Wall Street profit estimates are upbeat given the uncertain and challenging macro outlook.
Analysts call for EPS to grow 12% in 2023 to $12.83 and 16% in 2024 to $14.90.
On Jan. 25, MSCI announced a Google partnership to build an investment data platform in the cloud. Alphabet is the parent of Google and its cloud unit.
"The investment industry is experiencing an exponential growth in data. In today's fast-moving world, investors require the ability to analyze new and alternative sources of data to remain competitive and informed," said Henry Fernandez, chief executive officer of MSCI, in an accompanying news release.
Customers include asset managers, banks, corporates, insurers and wealth managers. MSCI's use of Google Cloud's artificial intelligence (AI) technology will allow those customers to "process structured and unstructured data at scale and more quickly than ever before," the company said.
