MSCI, or Morgan Stanley Capital International, is a financial company that is best known for their stock market indexes, such as the MSCI World and MSCI Emerging Markets Index. These indexes track the performance of various sectors of the stock market and are used as benchmarks by many investment funds. Nearly $15 trillion of assets are benchmarked to its indexes and it collects fees from clients who use these products.
For investors, it is loved for its predictability as 97% of MSCI’s revenue from 2017-2023 was of recurring variety.
More importantly, the stock has overwhelmingly outperformed the S&P500 over the last decade.
Despite consistently growing both top and bottom lines, the stock dropped almost 14% on its recent earnings call in April. Revenue came in slightly below consensus (0.8% off). The drop sent shares to the 2022 lows despite posting higher revenue and net income since.
Let’s review the chart and see how investors may see up to 50% gains.