Asset-linked fees jumped 25 percent, yet $593 already needs about 22 times next year’s earnings. A $610 target is a market-like return, including the dividend.
Key points
- $975 million of Index asset-based run rate, up 22 percent year over year, is the growth engine.
- 8.7 percent organic subscription run-rate growth; Sustainability net new sales were negative.
- $27 of 2027 earnings at 22.5 times produces a $610 stock, 3 percent above $593 plus the $8 dividend.
The call
The $593 share already requires about 22 times 2027 earnings of $27. That multiple assumes Index assets stay high, buybacks continue, and Sustainability stops shrinking. It is not cheap for 10 percent earnings growth after the tax benefit fades.
I model $3.85 billion of 2027 revenue and $27 of diluted earnings on 70.5 million shares. At 22.5 times that is $610. The market is about right: Index AUM growth is real, but fee compression, higher interest, and ESG cancellations cap the multiple.
Revenue and operating income ($ millions)- Revenue
- Operating income
- My revenue forecast
SEC 10-Q/10-K facts through Q3 2026; 2026E–2027E are mine
Valuation
| Item | Figure |
|---|
| 2027 revenue (mine) | $3.85 billion |
| 2027 diluted EPS (mine) | $27.00 |
| Multiple | 22.5 times |
| 12-month target | $610 |
| Dividend next 12 months | about $8.20 |
| Implied total return from $593 | about 4 percent |
22.5 times is a franchise multiple for 95 percent retention and 56 percent operating margins, not a growth multiple. Asymmetry is modest: being right is a market return; being wrong on AUM or ESG is a 15 percent drawdown.
Organic subscription run-rate growth vs asset-based feesMSCI 10-Q operating metrics, September 30, 2026
Risks
- Equity-index ETF assets reverse; watch monthly AUM in EEM, IEMG and the company’s $2.9 trillion ETF figure.
- Sustainability retention stays near 91 percent; watch quarterly net new sales in that segment.
- Interest expense keeps rising with the revolver; watch the $288, $291 million 2026 guide.
What would change my mind
A four-quarter stretch of organic subscription growth above 11 percent with Sustainability net new sales positive would support 25 times and a buy.