Why MSCI’s new private markets partnerships matter for investors

MSCI (MSCI) has moved further into private markets data with new partnerships that link its analytics to both large institutions and mid market managers, raising fresh questions about how the stock’s current valuation lines up with these efforts.

MSCI’s recent private markets partnerships with UBS and Petra come as the stock trades around US$603, with a 90 day share price return of 12.46% pointing to building momentum despite a more modest 1 year total shareholder return of 5.36%.

If MSCI’s push into data heavy private markets has your attention, this can be a good moment to widen your watchlist and check out 18 top founder-led companies

Recent gains leave MSCI caught between two stories: one about a business leaning further into private markets data and another about sentiment warming to the stock again. How does that mix stack up against today’s valuation?

Most Popular Narrative: 126% Overvalued

Compared with MSCI’s last close at $603.35, the most followed narrative on Simply Wall St, according to Esteban, anchors fair value much lower at $267, which frames the private markets story very differently.

MSCI is a Wide Moat compounding machine whose index benchmarks serve as the institutional standard for $16.5 trillion in global AUM, generating 75%+ recurring revenue at 93-95% retention rates and approximately 50% FCF margins. The investment thesis rests on three durable pillars: (1) permanent switching costs in the Index segment, where fund mandate rewrites, LP notifications, and derivative contract renegotiations make benchmark migration prohibitively costly for all but the most determined sponsors; (2) secular tailwinds from the continued growth of passive investing and the institutionalization of private markets, which expand MSCI's AUM-linked revenue with zero incremental cost; and (3) an emerging private assets franchise replicating the Index playbook in a $10 trillion+ private equity and credit market that currently lacks institutional-grade benchmarks. At the 15% Dhandho hurdle rate, the Neutral scenario requires MSCI to execute its stated plan without surprises, a plausible bar given the contractual, subscription-heavy revenue model, 11 consecutive years of double-digit adjusted EPS growth, and a run-rate exit rate of $3.3 billion as of December 31, 2025.

That fair value hinges on a rich mix of recurring index revenue, a specific return hurdle, and a bold view on how private assets scale from here. Curious how those ingredients combine into a price that sits far below today’s MSCI share price? The full narrative sets out the cash flow and growth glide path in far more detail.

Result: Fair Value of $267 (OVERVALUED)

However, MSCI’s narrative could be tested if passive flows slow or if private markets standardize around competing benchmarks, which would challenge those premium assumptions.

Another view: MSCI through the DCF lens

Esteban’s narrative pins MSCI’s fair value at $267, well below the current $603.35 share price. Our DCF model presents a different perspective, with an estimated future cash flow value of $682.65. This puts the stock about 11.6% below that mark and frames today’s price as a potential discount instead of a premium. Which story do you think better fits how MSCI actually earns its cash flows over time?

Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out MSCI for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover 44 high quality undervalued stocks. If you save a screener we even alert you when new companies match - so you never miss a potential opportunity.

Next Steps

With MSCI sitting between contrasting narratives on value and growth, it helps to look past the headlines and into the underlying data yourself. If you want a concise view of both sides of the argument, start with the 4 key rewards and 2 important warning signs.

Looking for more investment ideas beyond MSCI?

If MSCI has sharpened your focus, do not stop here. Use the Simply Wall St Screener to line up fresh stock ideas that match your investing style.

• Target resilient income by scanning for companies offering steady payouts through the 9 dividend fortresses.
• Hunt for quality at a reasonable price by filtering stocks that look attractively priced with the 44 high quality undervalued stocks.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.