_edited.png)
RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Morningstar, Inc. (XNAS:MORN) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
MORN
Name:
MORNINGSTAR, INC. (XNAS:MORN)
Sector:
- 4500.00K
Industry:
Financial Data & Stock Exchanges
CEO:
Mr. Kunal Kapoor
Total Employees:
10,767
Our Technological Advancement Rating
Our Rating:
D
Technological advancement compared to industry is -46.33% lower
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF MORNINGSTAR, INC.(MORN) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND FINANCIAL DATA & STOCK EXCHANGES INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
225.59
One Month Price Target:
$227.02
Six Month Price Target :
$234.18
Likely Price in One Year's Time:
Ticker:
$242.77
Likely Trading Range Today Under (Normal Volatility)
$225.
Price Upper limit ($) :
$226.54
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$216.46
This week:
$205.18
This month :
$184.78
Other Primary facts
Market Cap:
9.75B
Market Cap Classification:
Mid Cap
Number of Shares
IPO Date:
42.48M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
9.5%
-10.11%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$267.90
$248.27
$183.28
$202.91
Medium risk (<10%) entry points
Buy Call
Sell Call
$241.88
Buy Put:
Sell Put:
$237.69
$209.25
$213.49
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
MORN
Sharpe Ratio:
3.45%
Comparison:
MORN, is amongst the top 20% stocks with highest risk-adjusted returns
Sharpe ratio is 27.65% higher than the industry
& ratio is 51.38% higher than the market/S&P 500 average
Average Returns/Yield of
MORN
Daily returns:
0.08%
Weekly returns:
0.39%
Monthly returns:
1.56%
Yearly returns:
18.99%
Comparison of returns:
Average annual returns/yield (last 3 years) is -1.26% below industry average
Classification:
MORN, is amongst the top 40% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.61
Statistical test of Returns:
MORN has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
2.01%
Weekly Volatility:
4.49%
Monthly Volatility:
8.98%
Yearly Volatility:
31.10%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
2.14%
Volatility in last five trading days has been 6.80% above long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-4.05%
Weekly VaR:
-9.05%
Monthly VaR:
-18.09%
How Much Can the price of
MORN
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-15%
Worst case (decline):
-62.67%
This translates to price declining to:
$191.52
This translates to price declining to:
$84.21
Severe Crash Probability
Risk of crash in next 6/12 months: High (50-70%)
What is Value at Risk (VaR)?
Risk Fundamentals
MORN is a 27.69% riskier investment compared to the market/S&P 500 & is 9.39% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is -13.80% below industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
MORN
Beta in relation to market/S&P 500--1.13
Expected beta in 1 year's time:
0.716
Expected beta in 3 year's time:
1.013
Unlevered (debt free) Beta:
0.844
Beta in relation to Nasdaq (XNAS):
0.355
Beta in relation to all global stocks::
0.557
Beta Comparison & Analysis
Beta of competitors/peers::
0.94
Beta is 20.55% higher than peers
Average Industry Beta:
0.802
Beta is 41.34% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
11.70%
Sustainable growth rate is -67.01% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
0.078
Alpha is -24.26% below industry average alpha yield
Alpha is 499% higher than market/& is unsustainably high
Analysis of Cost of Capital of
MORN
Equity cost of capital:
0.109
Equity cost of capital is 26.27% above industry mean WACC
Unlevered (without debt) cost of capital:
8.12%
Before-tax cost of debt:
1.45%
After-tax cost of debt:
1.14%
Overall debt rating:
Highest AAA investment grade
Weighted average cost of capital (WACC):
1.14%
WACC is 26.55% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$41.51
Revenue growth rate per share of (3Y):
7.09
Annual revenue growth rate is 92.39% above the industry average
EPS:
$4.25
Expected Annual growth rate of EPS (3Y):
7.72%
Expected future EPS growth rate is -50.58% lower than the Financial Data & Stock Exchanges industry
Free cash flow (FCF) per share:
$7.08
Balance sheet equity growth per share: 25.75%
Equity growth rate per share is -11.06% lower than the industry
Debt per share
$14.91
EBITDA per share
$9.69
Valuation Analysis Today of
MORN
P/E Ratio:
53.86
P/E Ratio of Competitors/Peers:
21.96
P/E ratio is 145.32% higher than main peers & is 73.16% higher than the industry
Stock price/value with industry average P/E ratio: $132.20
MORN is 70.65% overvalued if valued using industry average P/E ratio
Share value as per dividend discount (DDM) model: $28.80
Present value of the expected future dividends only: $16.78
P/S (Price to Sales ratio):
5.43
Price to sales ratio is -45.21% below the industry mean
P/B (Price to book value ratio):
7.09
Price to free cash flow: 31.89
Price to free cash flow ratio is -8.19% lower than the industry
Net income growth rate (3Y):
4.40%
Net income growth rate is -93.11% lower than the industry average net income growth rate
Dividend Analysis
Dividend payout rate: 8.40%
Dividend yeild: 0.62%
Previous Dividend: $0.36
Previous adjusted dividend: $0.36
Previous Dividend: $1.40
Expected next dividend best case: $0.38
Expected next dividend worst case: $0.34
Average dividend payment (long-term): $0.32
Average dividend increase/decrease (growth rate) % per period: 2.40%
Expected next dividend payment date: 27/10/2022
Expected next dividend record date: 29/09/2022
Expected next dividend declaration date: 03/03/2022
Previous dividend payment date: 29/07/2022
Previous dividend record date: 07/01/2022
Previous dividend declaration date: 12/03/2021
Dividend History:
2022-06-30--$0.36
2022-01-06--$0.36
2021-07-08--$0.32
2022-03-31--$0.36
2021-10-18--$0.32
2021-04-08--$0.32
Dividend growth rate is -73.43% lower than the industry average
In-depth Debt & Leverage Analysis
Debt to equity ratio:
46.87%
Net debt to equity ratio:
13.86%
Debt to assets ratio:
22.08%
Net debt to assets ratio:
6.53%
Debt-to-asset ratio is -59.87% below industry average
Ability to repay debt:
Interest coverage ratio:
42.44
Interest coverage ratio is 41.32% more than industry average
Looking forward:
Debt growth rate:
-15.19%
Annual debt growth is -154% lower than industry average debt growth rate
Debt repayment rate in last quarter: 4.52%
Analysis of Key Statistics
Correlation of price movement with the market:
0.34
Statistical significance of correlation:
MORN has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.632
Stock price is -46.16% less correlated with the market compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.632
Correlation of price movement with Nasdaq (^IXIC):
-0.028
Covariance of price movement with the market:
-0.032
Kurtosis
2.453
Returns are more concentrated around the mean (platykurtic), compared to a normal distribution
Skewness of returns:
-0.189
Returns are, approximately, symmetrical
Fundamental Analysis & Dupont Analysis of
MORN
Gross Profit Margin Ratio:
234%
Operating Profit Margin Ratio:
13.96%
Operating profit margin is -59.95% lower than the industry
Net Profit Margin Ratio:
234%
Effective Tax Rate:
26.73%
Effective tax rate is 19.65% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
13.65%
Return on equity (ROE) is -73.18% lower than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
6.43%
Return on assets (ROA) is -43.07% lower than the industry
Financial Leverage:
1.3x
Current Ratio:
1.25
Current ratio is -25.92% below industry average
Cash Conversion Cycle (days):
57.6
Cash conversion cycle is 133.74% above industry average
The remaining useful life of property plant & equipment is: 4.8 years
Stock based compensation to net income ratio:
-
In-depth Efficiency Analysis
Revenue generated per employee:
163.8K
Each employee generates -81% less revenue than industry average revenue per employee
EBITDA generated per employee:
38.2K
Each employee generates -91% less EBITDA than industry average revenue per employee
Profit generated per employee:
17.1K
Each employee generates -94% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 0.4K
Each employee generates -100% less free cash flow than industry average revenue per employee
Assets/Capital per employee
182.7K
Each employee generates -100% less free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
MORN
EAST WEST BANCORP, INC. (XNAS:EWBC)
ERIE INDEMNITY COMPANY (XNAS:ERIE)
Cboe Global Markets, Inc. (BATS:CBOE)
ZIONS BANCORPORATION, NATIONAL ASSOCIATION (XNAS:ZION)
COMMERCE BANCSHARES, INC. (XNAS:CBSH)
HBANO
SEI INVESTMENTS COMPANY (XNAS:SEIC)
ARES CAPITAL CORPORATION (XNAS:ARCC)
FIRST CITIZENS BANCSHARES, INC. (XNAS:FCNCA)
Current Analyst Ratings
Strong buy�0%
Buy�0%
Hold�0%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: -
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
1.76B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
732.40M
1.03B
-
338.90M
633.20M
294.30M
151.70M
784.90M
1.40M
9.70M
151.70M
411.70M
246.20M
184.50M
246.20M
65.80M
184.50M
Statement of Cash Flow
Date:
Period:
-
Differed Income Tax :
-
Stock Based Compensation :
-
Change in Working Capital :
- 65100.00K
Accounts Receivables:
-
Other Working Capital:
-
Other Non-Cash Items:
42.50M
Net Cash Provided by Operating Activities:
23.50M
Investments in PP&E:
-
Net Acquisitions:
- 7800.00K
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
3/31/22
2022
Q1
483.50M
61.40M
544.90M
276.40M
-
81.50M
902.80M
321.90M
1.20B
321.60M
64.10M
13.20M
43.20M
1.97B
-
2.87B
-
37.40M
-
428.60M
254.50M
720.50M
633.50M
70.00M
797.20M
-
1.52B
-
-
-
-
March 31, 2022 at 6:00:00 AM
1.52B
1.35B
2.87B
125.50M
670.90M
187.4M
-
- 25900.00K
- 33700.00K
- 30000.00K
-
- 110600.00K
- 15500.00K
167.90M
11.80M
- 1900.00K
- 300.00K
483.50M
483.80M
23.50M
- 28000.00K
- 4500.00K
Our Proprietary Portfolio Rating
Our Rating:
D
Price Forecast/Expected Price in Next 5 Years of
MORN
2023
2024
2025
2026
2027
$238.51
$256.67
$276.22
$297.26
$319.90