Value Investing with Legends · Friday, October 30, 2026
Jim Engle details why credit rating agencies Moody's and S&P Global possess irreplaceable asset models, noting that while corporate issuers pay the fees, the deep reliance of auditors and regulators on their legacy ratings creates powerful, high-margin, asset-light moats.
“And what I understood over time was that there are many parties in the debt markets that rely on Moody's and S&P's credit ratings. They each have roughly 40% of the market.”
“The auditors, the regulators all depend deeply on this, but they don't pay the freight. It's the corporate issuer. So I have found over time that something that is highly valued where somebody doesn't have to pay for it, that's something that has real staying power.”