NASDAQ$MORN

Morningstar Inc. · Q3 2024 earnings

Q3 2024 earnings · · Investor relations

Briefing

Morningstar's financial performance for Q3 2024 showed double-digit revenue growth and expanded operating margins.

Morningstar, Inc. reported a 10.5% increase in revenue to $569.4 million and a 65.0% increase in operating income to $115.5 million in Q3 2024. Diluted net income per share increased by 204.4% to $2.77, with adjusted diluted net income per share increasing by 56.3% to $2.00. The company's growth was primarily driven by Morningstar Credit, PitchBook, and Morningstar Data and Analytics.

  • Revenue increased by 10.5% to $569.4 million, with organic revenue growth of 10.1%.
  • Operating income increased by 65.0% to $115.5 million, and adjusted operating income increased by 41.6%.
  • Diluted net income per share increased by 204.4% to $2.77; adjusted diluted net income per share increased 56.3% to $2.00.
  • Cash provided by operating activities increased 46.8% to $191.9 million, and free cash flow increased 53.6% to $155.8 million.

Headline financials

Total Revenue

$569M

Previous: $516M+10.5%
EPS (adj)

$2.00

Previous: $1.28+56.3%
Capital Expenditures

-$102M

Previous: -$89.1M-14.6%
Free Cash Flow

$17.6M

Previous: -$50M+135.2%
Net Income

$120M

Previous: $39.1M+206.1%
Operating Income

$116M

Previous: $70M+65.0%
Gross Profit

$347M

Previous: $313M+10.9%
Total Assets

$3.57B

Previous: $3.34B+6.6%
Stock-Based Comp

$13.2M

Previous: $14.7M-10.2%

Revenue & EPS history

Morningstar · Revenue · Quarterly

$569M

Q3 2024+10.5%vs Q3 2023
Beat estimate in 4 of 6 quarters(67%)
ActualEstimate

Revenue by segment

Morningstar · $409M total across 4 segments · Q2 2023

  • Morningstar Data & Analytics
    $194M
  • PitchBook
    $134M
  • Morningstar Wealth
    $50M
  • Morningstar Retirement
    $31.4M

Forward guidance

This press release contains forward-looking statements as that term is used in the Private Securities Litigation Reform Act of 1995. These statements are based on our current expectations about future events or future financial performance.

Tailwinds

  • The Company offers an extensive line of products and solutions that serve a wide range of market participants, including individual and institutional investors in public and private capital markets, financial advisors and wealth managers, asset managers, retirement plan providers and sponsors, and issuers of fixed-income securities.
  • Morningstar provides data and research insights on a wide range of investment offerings, including managed investment products, publicly listed companies, private capital markets, debt securities, and real-time global market data.
  • Morningstar also offers investment management services through its investment advisory subsidiaries
  • The Company operates through wholly-owned subsidiaries in 32 countries.
  • Morningstar encourages all interested parties to submit questions in writing.

Headwinds

  • failing to maintain and protect our brand, independence, and reputation
  • failure to prevent and/or mitigate cybersecurity events and the failure to protect confidential information, including personal information about individuals
  • compliance failures, regulatory action, or changes in laws applicable to our credit ratings operations, investment advisory, environmental, social, and governance, and index businesses
  • failing to innovate our product and service offerings, or anticipate our clients’ changing needs
  • the impact of artificial intelligence and related technologies on our business, legal, and regulatory exposure profile and reputation

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2024

Historical avgQ3 2024

+0.5%

Avg return

Earnings day

+0.0%

Avg return

5 days after

+0.4%

Avg return

30 days after

53%

36 / 68 earnings

Positive

+12.6%

Q3 2018

Best reaction

-12.9%

Q1 2023

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026-10.0%-11.2%-3.0%
Q4 2025+2.3%+5.7%+19.0%
Q3 2025+2.8%+1.4%+2.9%
Q1 2025-0.5%+3.1%+8.3%
Q4 2024-2.8%-6.5%-7.5%
Q3 2024-3.5%-2.7%+0.8%
Q2 2024+4.5%+4.7%+1.6%
Q1 2024-4.3%-5.5%-0.9%
Q4 2023-0.2%+8.1%+9.8%
Q3 2023+11.1%+12.6%+23.7%
Q2 2023+6.5%+6.5%+2.7%
Q1 2023-12.9%-7.9%+1.7%
Q4 2022-11.1%-11.0%-19.6%
Q3 2022+2.1%+4.7%+11.2%
Q2 2022+3.5%-0.0%-5.8%
Q1 2022+1.4%-4.4%-0.6%
Q4 2021+6.4%+2.0%+1.3%
Q3 2021+4.8%+3.1%+1.4%
Q2 2021+3.0%+5.6%+7.0%
Q1 2021+3.7%+3.5%-7.7%
Q4 2020-1.2%-8.9%-5.6%
Q3 2020+6.9%+6.5%+8.8%
Q2 2020+4.9%+2.8%+0.1%
Q1 2020+9.0%+3.8%+7.1%
Q4 2019-2.5%-6.4%-35.4%
Q3 2019-7.2%-4.7%-1.1%
Q2 2019+0.6%-1.0%-0.8%
Q1 2019-0.9%+2.9%-2.7%
Q4 2018+0.3%+0.6%-3.9%
Q3 2018+12.6%+4.3%-0.8%
Q2 2018-2.7%-4.1%-0.9%
Q1 2018+6.2%+5.0%+13.8%
Q4 2017-1.1%-1.7%-1.3%
Q3 2017+1.9%-2.3%+6.3%
Q2 2017+2.9%+3.4%+1.6%
Q1 2017-4.1%-6.1%-6.8%
Q4 2016+1.8%+2.2%-2.0%
Q3 2016-6.4%-7.2%-4.8%
Q2 2016+1.0%+0.7%-1.8%
Q1 2016-4.2%
Q4 2015-0.5%
Q3 2015-1.9%
Q2 2015+3.2%
Q1 2015+3.5%
Q4 2014+10.7%
Q3 2014-0.3%
Q2 2014-2.4%
Q1 2014-4.6%
Q4 2013+4.3%
Q3 2013+4.9%
Q2 2013+0.7%
Q1 2013+0.5%
Q4 2012+1.9%
Q3 2012-1.3%
Q2 2012+2.4%
Q1 2012+1.7%
Q4 2011-0.1%
Q3 2011-0.4%
Q2 2011-2.5%
Q1 2010-1.7%
Q1 2011+1.5%
Q4 2010-2.2%
Q4 2008-2.2%
Q3 2009+0.1%
Q3 2010+0.1%
Q2 2010-1.1%
Q4 2009-1.1%
Q2 2009-1.1%

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