One-glance verdict
Within fair range
$260.69 our estimate vs market $191.02
Wall Street consensus: $236.67 (-9.2% lower than our fair-value estimate)
27% below our estimate
Fundamentals snapshot
Morningstar, Inc.
MORN · NMS · Financial Services · Financial Data & Stock Exchanges
Current price
$191.02
52-week range
$141.49 - $257.21
Market cap
$7.17B
Balance sheet
Stretched
12.60x Strong cushion
Net debt $1.38B. Interest coverage shows how many times profit covers the interest bill.
What stands out
3 Rewards
0 Risks
3 rewards · 0 risks
- Reward Revenue grew 4.9% last year.
- Reward Returns 32.0% on equity, ahead of 50% of its peers.
- Reward Free cash flow was positive in 10/10 years.
What this company does
Morningstar, Inc.
Morningstar is a financial data company that provides research, ratings, and software to help people make investment decisions. They primarily earn money by selling subscriptions to their data platforms, like PitchBook (which covers private companies) and Morningstar Direct (used by financial professionals). This model provides a steady stream of recurring revenue (predictable income that comes in regularly, like a magazine subscription) because their customers rely on their independent analysis.
How the company got here
Morningstar was started in 1984 by Joe Mansueto from his Chicago apartment with just $80,000. He saw that regular people lacked the information needed to make smart investment choices, especially as retirement plans were changing. The company's big break came with its famous "Star Rating" system for mutual funds (a simple way to compare funds based on their past performance), which helped it become a trusted name. Over the years, Morningstar grew by creating new products, moving online with its website, and acquiring other companies to add new capabilities, like data on private companies and credit ratings (an assessment of a borrower's ability to repay debt).
What it actually does
Morningstar is an investment research company that provides data, analysis, and ratings on a wide range of investments like stocks and mutual funds. Think of it as a consumer reports for investments; it helps people understand what they are investing in and how it compares to others. Everyday investors might use its website, Morningstar.com, to look up the star rating on a mutual fund in their 401(k) or read an analyst's (a financial professional who studies industries and companies) opinion on a stock. The company also sells more powerful software and data platforms to financial advisors and large investment firms to help them make decisions for their clients.
Morningstar Direct Platform
This is a major part of Morningstar's business, bringing in a large portion of its license-based revenue. It's a software platform designed for financial professionals, like asset managers and investment consultants, not for the everyday investor. These professionals pay a subscription fee to access a huge database of investment data, sophisticated analysis tools, and Morningstar's research to help them build and manage investment portfolios for their clients. This segment includes well-known tools like Morningstar Direct and Morningstar Data.
PitchBook
Acquired by Morningstar in 2016, PitchBook is a data and research platform focused on the private markets. This means it covers companies that aren't publicly traded on a stock exchange, like venture capital (money invested in new, small companies) and private equity (investments in private companies) firms. Its customers, which include investment banks, private equity firms, and venture capitalists, pay a subscription to access detailed information on private companies, deals, and investors to find and analyze investment opportunities. This is a significant and growing source of revenue for Morningstar.
Morningstar Credit
This segment provides credit ratings, research, and data on a wide range of debt securities (essentially, loans made to companies or governments). After acquiring DBRS, the world's fourth-largest credit rating agency, Morningstar became a more significant player in this area. Institutional investors (large organizations like pension funds or insurance companies that make substantial investments) pay for these ratings and research to help them understand the risk of lending money to or investing in the debt of different entities. This part of the business has been a major contributor to revenue growth.
Morningstar Wealth
This part of the company provides services and software for financial advisors and wealth managers. It offers tools like the Morningstar Wealth Platform and Morningstar Office, which help advisors manage their clients' portfolios, conduct research, and run their practices. The company makes money here through fees based on the amount of money managed on its platforms (known as assets under management or advisement) and through software subscriptions. This segment aims to be a one-stop-shop for advisors, providing the technology and investment insights they need to serve their clients.
Morningstar Retirement
This segment focuses on helping people save for retirement, primarily through their workplace retirement plans like 401(k)s. It offers services like "Managed Accounts," where Morningstar's professionals will manage an individual's retirement savings for them, creating a personalized investment strategy based on their age and goals. The company earns fees for these management services, often based on a percentage of the assets being managed. This division works with employers and retirement plan providers to offer these tools and services to employees.
What management is betting on now
Morningstar's strategy focuses on becoming essential to investors by providing valuable data, research, and software. They are investing in expanding their data and analytics, especially in private and less traditional investments, to meet the changing needs of investors. The company is also focused on growing its newer businesses, like Morningstar Credit and Morningstar Indexes (which are collections of investments used to track market performance), to challenge more established competitors. Ultimately, they aim to increase the long-term value of the business by investing in growth opportunities and new technologies that help investors succeed.
Price history
How the share price has moved
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Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q3
$155.80M
FY2024 Q4
$112.80M
FY2025 Q1
$58.80M
FY2025 Q2
$62.40M
FY2025 Q3
$160.10M
FY2025 Q4
$161.30M
FY2026 Q1
$53.60M
FY2026 Q2
$122.50M
Revenue
$663.20M
Net income
—
Diluted EPS
2.83
Operating cash flow
$155.70M
Free cash flow
$122.50M
Fetching…
Sources
Revenue
$644.80M
Net income
—
Diluted EPS
2.73
Operating cash flow
$91.50M
Free cash flow
$53.60M
Fetching…
Sources
Revenue
$641.10M
Net income
—
Diluted EPS
2.79
Operating cash flow
$204.00M
Free cash flow
$161.30M
Fetching…
Sources
Revenue
$617.40M
Net income
—
Diluted EPS
2.17
Operating cash flow
$195.70M
Free cash flow
$160.10M
Fetching…
Sources
Revenue
$605.10M
Net income
—
Diluted EPS
2.09
Operating cash flow
$99.00M
Free cash flow
$62.40M
Fetching…
Sources
Revenue
$581.90M
Net income
—
Diluted EPS
1.82
Operating cash flow
$91.00M
Free cash flow
$58.80M
Fetching…
Sources
Revenue
$591.00M
Net income
—
Diluted EPS
2.72
Operating cash flow
$153.40M
Free cash flow
$112.80M
Fetching…
Sources
Revenue
$569.40M
Net income
—
Diluted EPS
2.77
Operating cash flow
$191.90M
Free cash flow
$155.80M
Fetching…
Sources
Is it cheap or expensive?
Fair value $260.69 vs current price $191.02
Wall Street consensus is the average analyst price target: $236.67 (-9.2% lower than our fair-value estimate).
Our most-likely fair value is $260.69 a share — about 36.5% away from today's price of $191.02, so the stock currently looks fairly priced.
Is it drowning in debt?
Stretched
Net debt $1.4B. Interest coverage 12.6x.
Net debt
$1.38B
Interest coverage
12.60x
Morningstar, Inc.'s profit covers its interest bill about 12.6 times over. which is stronger than most peers shown here.
Stretched
Worse cushion
Baseline
Better cushion
MORN
BASELINE
Morningstar, Inc.
Total debt $1.90B Interest coverage 12.60x This is the baseline the peer rows are being compared against.
Total debt $15.75B Interest coverage 21.52x +71% vs MORN Carries about 1.7x more debt cushion than MORN.
Total debt $7.62B Interest coverage 12.32x -2% vs MORN Has roughly the same debt cushion as MORN.
Total debt $6.54B Interest coverage 8.16x -35% vs MORN Carries about 1.5x less debt cushion than MORN.
Total debt $1.57B Interest coverage 13.29x +5% vs MORN Has roughly the same debt cushion as MORN.
Total debt $4.62B Interest coverage 7.86x -38% vs MORN Carries about 1.6x less debt cushion than MORN.
What you should know
The case for and against MORN
3 Rewards
0 Risks
Rewards
-
Revenue grew 4.9% last year.
-
Returns 32.0% on equity, ahead of 50% of its peers.
-
Free cash flow was positive in 10/10 years.
Risks
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
18.16x
Forward P/E
13.71x
P/B
7.00x
P/S
2.79x
EV/EBITDA
12.57x
PEG ratio
2.31x
Profitability
How much profit each dollar creates
Gross margin
62.2%
Operating margin
24.2%
Net margin
16.4%
ROE
32.0%
ROA
9.6%
Health
Liquidity and balance-sheet strength
Debt / equity
1.86x
Current ratio
1.06x
Quick ratio
0.94x
Total debt
$1.90B
Total cash
$523.80M
Growth
How the business has been compounding
Revenue TTM
$2.57B
Revenue 5Y CAGR
9.5%
EPS TTM
10.52
EPS 5Y CAGR
75.5%
Cash flow
How much cash the business throws off
Operating CF TTM
$646.90M
Free CF TTM
$442.60M
FCF margin
17.2%
Dividend
Shareholder payout
Yield
1.1%
Payout ratio
18.6%
Last ex-div date
2026-10-02