Value
7.0/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 5.5 |
| P/S | 8.2 |
| Fwd P/E | 7.5 |
| PEG | 10.0 |
| Analyst target | 4.0 |
- ▸Forward P/E: 16.5x
- ▸PEG: 0.39
- ▸Attractively valued
MC · Why this verdict
Why Moelis & (MC) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictHOLD
Overall score5.9/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Moelis & Company combines exceptional business quality — a Piotroski score of 9 out of 9, 42% return on equity, and superior margins relative to peers — with a recently broken earnings beat streak and virtually no remaining upside to the near-term technical target, suggesting the quality franchise is fairly priced and patience is the appropriate stance.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
With the stock trading just 1.7% below the near-term resistance target and a risk/reward ratio of 0.24-to-1 that is deeply unfavorable, the current price reflects the quality of the franchise with little residual margin for incremental gains at the current entry. Price targets | If wrong, price breaks above $70.29 with sustained volume and holds that level for 3 consecutive weeks, opening a new price range and resetting the risk/reward. | →Stable |
| CounterHigh-quality franchises with consistent earnings power have historically sustained premium valuations for extended periods; a rich near-term multiple can persist if the quality profile and beat streak are maintained. | ||
With a Piotroski financial health score of 9 out of 9, a 42% return on equity that ranks superior to peers, and high-quality ratings across margins and asset returns, the franchise has demonstrated the financial characteristics of a durable, high-return business over multiple reporting periods. Quality breakdown | Quality indicators — margins, return on equity, and Piotroski score — remain at current levels or improve over the next four reported quarters. | →Stable |
| CounterAdvisory revenues for capital-markets-oriented businesses are inherently lumpy and transaction-dependent; if deal activity slows materially, margins could compress from their current levels and the quality metrics could deteriorate faster than the headline scores imply. | ||
Three prior consecutive quarters of positive earnings surprises — including upside of 35% and 36% in two of those periods — established a strong track record of under-promising and over-delivering, but the most recent quarter produced a 5% miss, breaking the streak and introducing uncertainty about whether the earnings discipline is intact. Earnings | The company reports a positive earnings surprise of more than 5% in the next reported quarter, confirming the most recent miss was episodic rather than the start of a new pattern. | →Stable |
| CounterAdvisory revenues are lumpy by nature; a single modest miss may simply reflect the timing of deal closings in one quarter, and the prior beat magnitudes suggest the model generates material upside in favorable conditions. | ||
The dividend has been specifically flagged as high but potentially unsafe; if the payout is not adequately covered by free cash flow or is being supported by debt rather than operating earnings, the yield premium embedded in the current valuation could reverse sharply upon a cut or suspension. Catalyst breakdown | If wrong, reported earnings per share stays above $0.50 per quarter for 4 consecutive periods with no dividend reduction, confirming the payout is covered and the yield-trap concern is overstated. | →Stable |
| CounterIf advisory pipelines remain active and operating earnings continue to beat, the dividend coverage may prove adequate and the flagged concern may be an overly conservative read on a cyclically strong franchise. | ||
With the stock trading just 1.7% below the near-term resistance target and a risk/reward ratio of 0.24-to-1 that is deeply unfavorable, the current price reflects the quality of the franchise with little residual margin for incremental gains at the current entry.
→StablePrice targets
- Expectation
- If wrong, price breaks above $70.29 with sustained volume and holds that level for 3 consecutive weeks, opening a new price range and resetting the risk/reward.
CounterHigh-quality franchises with consistent earnings power have historically sustained premium valuations for extended periods; a rich near-term multiple can persist if the quality profile and beat streak are maintained.
With a Piotroski financial health score of 9 out of 9, a 42% return on equity that ranks superior to peers, and high-quality ratings across margins and asset returns, the franchise has demonstrated the financial characteristics of a durable, high-return business over multiple reporting periods.
→StableQuality breakdown
- Expectation
- Quality indicators — margins, return on equity, and Piotroski score — remain at current levels or improve over the next four reported quarters.
CounterAdvisory revenues for capital-markets-oriented businesses are inherently lumpy and transaction-dependent; if deal activity slows materially, margins could compress from their current levels and the quality metrics could deteriorate faster than the headline scores imply.
Three prior consecutive quarters of positive earnings surprises — including upside of 35% and 36% in two of those periods — established a strong track record of under-promising and over-delivering, but the most recent quarter produced a 5% miss, breaking the streak and introducing uncertainty about whether the earnings discipline is intact.
→StableEarnings
- Expectation
- The company reports a positive earnings surprise of more than 5% in the next reported quarter, confirming the most recent miss was episodic rather than the start of a new pattern.
CounterAdvisory revenues are lumpy by nature; a single modest miss may simply reflect the timing of deal closings in one quarter, and the prior beat magnitudes suggest the model generates material upside in favorable conditions.
The dividend has been specifically flagged as high but potentially unsafe; if the payout is not adequately covered by free cash flow or is being supported by debt rather than operating earnings, the yield premium embedded in the current valuation could reverse sharply upon a cut or suspension.
→StableCatalyst breakdown
- Expectation
- If wrong, reported earnings per share stays above $0.50 per quarter for 4 consecutive periods with no dividend reduction, confirming the payout is covered and the yield-trap concern is overstated.
CounterIf advisory pipelines remain active and operating earnings continue to beat, the dividend coverage may prove adequate and the flagged concern may be an overly conservative read on a cyclically strong franchise.
Per-dimension breakdown
Quality
8.3/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 10.0 |
| ROA | 10.0 |
| Gross margin | 10.0 |
| Op margin | 5.1 |
| Net margin | 7.2 |
| Current ratio | 6.7 |
| Moat | 7.1 |
| Piotroski F | 10.0 |
- ▸Excellent ROE: 42%
- ▸Strong Piotroski F-Score: 9/9
- ▸High-quality business
Growth
6.8/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 3.6 |
| EPS growth | 10.0 |
Momentum
2.3/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 0.0 |
| OBV | 1.0 |
| MA position | 5.0 |
| Volume | 0.0 |
- ▸Volume distribution (falling OBV)
- ▸Above 200-MA but MA slope flat
Sentiment
5.3/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 6.0 |
| erm sentiment | 5.0 |
Insider
5.0/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.1 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
Peer rank
3.2/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 4.1 |
| quality rank | 6.9 |
| growth rank | 1.9 |
- ▸Superior ROE vs peers
Technical
7.5/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 7.7 |
| support resistance | 7.6 |
| 52w position | 7.3 |
Risk (lower is worse)
6.0/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 6.4 |
| days to cover | 5.4 |
| volatility | 1.6 |
| put call | 10.0 |
| implied vol | 5.3 |
| max pain risk | 7.0 |
| beta | 3.8 |
| debt equity | 8.3 |
Catalyst
6.0/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 6.7 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| dividend safety | 3.5 |
- ▸Strong earnings: 3B/1M
- ▸Yield trap warning: high yield but unsafe
How the verdict was assembled
Engine trigger
Maintain position. Not compelling to add more.
Engine technical detail
verdict_path:
L4:PATH_F_HOLDPassed (6)
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:35d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- MOMENTUM:2.3<4.5
- ASYMMETRY:-0.8=NEGATIVE
Warning (0)
none
Reward-to-Risk
-0.80
Upside
-7.0%
Downside
8.7%
Sizing output
AVOID
SetupUNKNOWN — No clear chart pattern; technical signals are mixed
EdgeTEMP_HEADWIND — High quality (8.3) with weak momentum (2.3)
SuitabilityAGGRESSIVE — Beta 1.85>1.3, MCap $4.8B<$5B
Investment implication
None of the engine's positive-conviction paths (C-quality, D-momentum) triggered — the F-path HOLD reflects balanced signals. Strongest-cleared gate: INSIDER:OK. Top dim: Quality at 8.3; weakest: Momentum at 2.3. No conviction either direction.
The strongest dimensions are Quality at 8.3, Technical at 7.5, and Value at 7.0; the weakest are Momentum at 2.3, Peer rank at 3.2, and Insider at 5.0. The V9 engine flagged 2 failed gates, producing an asymmetric reward-to-risk of -0.80 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1With a Piotroski financial health score of 9 out of 9, a 42% return on equity that ranks superior to peers, and high-quality ratings across margins and asset returns, the franchise has demonstrated the financial characteristics of a durable, high-return business over multiple reporting periods.
Trip ifReturn on equity falls below 20% for 2 consecutive reported periods, from the current 42%, indicating the quality franchise is deteriorating under revenue pressure.
- P2Three prior consecutive quarters of positive earnings surprises — including upside of 35% and 36% in two of those periods — established a strong track record of under-promising and over-delivering, but the most recent quarter produced a 5% miss, breaking the streak and introducing uncertainty about whether the earnings discipline is intact.
Trip ifEPS surprise exceeds 5% for 2 consecutive quarters following the current miss, confirming the miss was episodic and earnings discipline is intact.
- P3The dividend has been specifically flagged as high but potentially unsafe; if the payout is not adequately covered by free cash flow or is being supported by debt rather than operating earnings, the yield premium embedded in the current valuation could reverse sharply upon a cut or suspension.
Trip ifReported EPS per share stays above $0.50 for 4 consecutive quarters with no dividend announcement reduced, confirming payout coverage has not deteriorated.
- P4With the stock trading just 1.7% below the near-term resistance target and a risk/reward ratio of 0.24-to-1 that is deeply unfavorable, the current price reflects the quality of the franchise with little residual margin for incremental gains at the current entry.
Trip ifPrice breaks above $70.29 and holds that level for 3 consecutive weeks with rising volume, confirming the stock was underpriced rather than fully priced at the current level.