MSCI's (MSCI) net new subscription bookings are expected to decline by nearly 18% year-over-year to $46 million in Q2 due to "tough" comparisons with prior year deals, including Moody's (MCO) partnership deal and a sizeable hedge fund deal, RBC Capital Markets said in a Tuesday note.
RBC said that fund launch activity continued "to be challenged" in Q1 but expects an improvement through the rest of the year with bookings growth inflection expected in H2 and fiscal year 2026.
While active asset manager growth slowed in the index business, double-digit growth in other segments like hedge funds, wealth managers, asset owners and broker-dealers is diversifying MSCI's revenue base, the firm said.
RBC said it expects Q2 adjusted earnings of $4.12 per share and revenue to grow 9.5% year-over-year to $775 million. Analysts polled by FactSet are expecting Q2 adjusted EPS of $4.11 and revenue of $764 million.
RBC has an outperform rating on the company's stock with a $675 price target.
Price: 575.95, Change: -0.79, Percent Change: -0.14
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